Conversation with Arthur Hayes: Altcoins may not rise again, Bitcoin to reach $250,000 by year-end
TechFlow Selected TechFlow Selected
Conversation with Arthur Hayes: Altcoins may not rise again, Bitcoin to reach $250,000 by year-end
Stay rational when buying altcoins and avoid blindly following trends.
Navigating Web3 tides with focused insightsCompiled & Translated: TechFlow
Guest: Arthur Hayes
Hosts: Bonnie & David Lin
Podcast Source: Bonnie Blockchain
Original Title: Crucial! Your Cryptocurrencies Might Not Rise Anymore—But These Assets Are Worth Buying │Arthur Hayes│Bitcoin Conference Vegas 2025【Bonnie Blockchain】feat. @TheDavidLinReport
Air Date: June 16, 2025
Key Takeaways
This episode features Arthur Hayes, the inventor of cryptocurrency perpetual contracts, sharing his outlook on the future economy. Having spent most of his career in Asia, he has deep insights into Asian financial markets and directly answers financial questions even many Asian politicians struggle with. What’s his view on the crypto market's next move? Why does he believe most altcoins you hold will never rise again? And what’s his take on Bitcoin’s price trajectory?
Highlights of Key Insights
-
Bitcoin could reach $250,000 by the end of this year.
-
Retail interest in Bitcoin remains strong due to its outstanding performance and relative ease of understanding compared to other crypto assets.
-
Most altcoins may not rise this year due to a lack of "product-market fit"—their products fail to meet market demand, and these projects typically generate no revenue to return to token holders.
-
Compared to stocks or gold, Bitcoin’s scarcity and decentralization give it unique advantages in hedging against currency devaluation and liquidity surges.
-
When selecting altcoins, focus primarily on the “narrative”—the story behind a project and its logic for attracting investors.
-
Approach altcoin investments rationally and avoid blindly following trends.
-
The U.S.-China relationship will gradually drift apart but won’t collapse as rapidly as some predict.
-
Most traders don’t truly care whether a platform is fully decentralized; they prioritize liquidity and diverse trading products.
-
Exchanges offer little product innovation and similar fee structures, making marketing the core battleground.
-
Generational conflicts may intensify, and governments are likely to respond by printing large amounts of money—the simplest and most direct solution from their perspective.
Bitcoin Price Outlook
David:
Can you elaborate on your timeline for Bitcoin reaching $1 million by 2028? Is your previous forecast of $125,000 by year-end still valid?
Arthur Hayes:
I still believe Bitcoin can reach $250,000 by the end of this year. While there may be volatility along the way, that remains my year-end target. My $1 million prediction assumes that major global economies could print around $9 trillion over the coming years. For example, the U.S. government plans to support institutions allowed to create mortgage-backed securities, potentially leading to $5 trillion in new money creation.
Additionally, due to the supplementary leverage ratio exemption, bank systems might purchase up to $1 trillion in assets, including those sold by foreign investors. This will make banks more flexible—they’ll no longer need to reserve capital for Treasuries—and can instead lend more to the real U.S. economy. This could boost credit availability in sectors like manufacturing, with some funds eventually flowing into the crypto market.
David:
When the Fed implemented quantitative easing in 2020, nearly all asset classes rose—not just Bitcoin. That was positive for Bitcoin, but based on your analysis, it also seems good news for other assets like stocks and gold. Why do you think Bitcoin will outperform them under such conditions?
Arthur Hayes:
The main reason is Bitcoin’s fixed supply—strictly capped at 21 million coins. Also, Bitcoin’s market cap is relatively small, so when large amounts of capital flow into this narrow market, prices surge quickly. This is why Bitcoin has been the top-performing financial asset over the past 15 years. Compared to stocks or gold, Bitcoin’s scarcity and decentralization give it unique advantages during currency devaluation and liquidity floods.
Bitcoin Hits New Highs—But Retail Interest Is Missing?
David:
The market is evolving fast. Do you think current monetary easing (money printing) will trigger more “Degen” activity?
Arthur Hayes:
Yes, I agree. If you don’t own much in financial assets but see inflation eroding your purchasing power, you might risk your limited savings on high-risk investments to fight back.
David:
Why does “Degen” activity seem lower now than in 2021? I mean, retail interest in altcoins. In fact, some have noticed viewership on crypto-related channels is significantly lower than four years ago, despite Bitcoin and many other cryptos hitting new highs.
Arthur Hayes:
I think the main reason is many altcoins have performed poorly. Their pricing is flawed—often overvalued. When you ask, “Okay, your project is live, the hype is over—where are your customers? Where’s the revenue?” the answer is often “We have nothing.” Yet, their fully diluted valuation (FDV) might be as high as $5 billion. How do you grow that tenfold? It’s extremely difficult. Going from $500 million to $5 billion is easier, but going from $10 billion to $100 billion becomes very tough at the margin. So I believe altcoin prices are generally too high to attract new investors.
David:
Some say Bitcoin is now seen more as an institutional investment tool, so retail interest is declining. Do you find that argument convincing?
Arthur Hayes:
Retail interest in Bitcoin remains strong because of its excellent performance and because Bitcoin is the easiest-to-understand crypto asset.
Your Altcoins May Never Rise Again
Bonnie:
Everyone’s asking—will altseason come? Some say this cycle has too many low-quality projects. What’s your take on the current situation?
Arthur Hayes:
I believe this year, most altcoins may not rise because they lack “product-market fit”—their products simply don’t meet market needs. Moreover, these projects usually generate no revenue to return to token holders. In other words, they’re more like venture-capital-style tokens with high FDVs and low circulating supplies. Such tokens tend to perform poorly. That’s why we see projects like Berachain and Monad seeing prices almost constantly decline. Despite massive funding and hype, without real users paying for their products or services, prices struggle to rise. However, there are exceptional projects that do achieve product-market fit—users actually pay for their services, and that revenue flows back to token holders. I believe these projects will perform well, such as Pendle and Ethfi.
Bonnie:
Risk-investor-backed tokens did very well in the last cycle. Why is this cycle different?
Arthur Hayes:
The key issue remains lack of product-market fit. If a project has a sky-high valuation but no real users on its blockchain or using its products, reigniting market interest after a price drop becomes extremely difficult.
Bonnie:
I remember you mentioned in a past interview that Bitcoin’s market dominance could reach 70%. Would “altseason” happen then?
Arthur Hayes:
Yes, I still believe that will happen. Right now, Bitcoin’s market dominance is probably around 65%.
David:
So before Bitcoin reaches that level, could other crypto assets still outperform?
Arthur Hayes:
Currently, that doesn’t seem obvious. I think Bitcoin’s market dominance largely depends on Ethereum’s performance. If Ethereum’s price and market activity don’t change significantly, Bitcoin’s dominance ratio is unlikely to shift much. Right now, Ethereum’s popularity is fading, and many investors have lost interest. So if the market cycle shifts, I’d rather bet on Bitcoin than other assets.
How to Pick Altcoins?
Bonnie:
How do you personally pick altcoins? What factors do you usually consider?
Arthur Hayes:
I mainly focus on the “narrative”—the story behind a project and its logic for attracting investors. The market now emphasizes stable cash flow generation. If a project generates significant cash flow, that’s crucial for me. Also, I look at whether investors can get tangible returns by holding the project’s token.
Bonnie:
What about valuation? Do you pay special attention to that?
Arthur Hayes:
For early-stage projects, we usually set a clear investment cap to avoid overpaying. But for more liquid projects, I focus more on whether they can generate stable cash flow.
Bonnie:
Don’t you think narratives change too fast? It feels hard to keep up.
Arthur Hayes:
They do, but if you buy at the right price, it won’t matter. If you enter early enough, you’re likely to profit once the project launches. But if you chase every trend at peak prices, you’ll likely end up losing money. The key is to stay rational and avoid blind speculation.
The Inventor of Crypto Perpetual Contracts
Bonnie:
Can you briefly share what inspired you to design perpetual contracts? How did the idea come about?
Arthur Hayes:
Actually, the idea came from customer feedback during our early operations. My co-founder and I handled all customer support and found many users couldn’t understand traditional futures contracts. They were confused about why futures prices differed from spot prices and why futures had expiration dates. These issues frustrated users and consumed a lot of our time explaining.
So we started thinking—can we design a product with no expiry and high leverage? That’s how we created the perpetual swap. After multiple attempts, we launched an easy-to-understand product in May 2016. Initially, most people weren’t interested, but over time, more adopted it because it solved real user problems and reduced our repetitive support workload.
I personally rarely use leveraged trading. If I invest, I mostly buy spot assets. I’d recommend leveraged trading only to those who have enough time to study the market and master trading skills. If you lack time and patience, avoid leverage—it’s too risky.
Bonnie:
If I plan to use perpetual contracts, what should I focus on first—risk or position size?
Arthur Hayes:
The most important thing is to define your goal. You need to know exactly what you want—how much return you expect, how much risk you can tolerate, when you’ll cut losses or add positions. These must be planned before trading begins. Once in the market, emotions can easily cloud judgment, leading to bad decisions. Proper preparation is key to successful trading.
Why Did the Taiwan Dollar Suddenly Appreciate?
Bonnie:
In recent days, the Taiwan dollar surged 10% against the U.S. dollar, but our bankers can’t explain why. What’s your take?
Arthur Hayes:
Indeed, it’s a fascinating phenomenon. I won’t dive too deep, but refer to research by Brad Setser and another economist in the Financial Times (FT), who noted that Taiwan’s life insurance companies might be among the wealthiest institutions globally. These firms have massive overseas investments, and Taiwan itself is a key hub in global manufacturing, especially in semiconductors. However, the Taiwanese government and central bank have long pursued a weak-currency policy. To maintain this, they create abundant TWD liquidity domestically—partly explaining why housing prices in Taipei and other cities remain high.
These institutions accumulate large USD reserves but, to avoid being labeled “currency manipulators” by the U.S., transfer dollars to Taiwan’s life insurers. These insurers then indirectly hold large amounts of U.S. Treasuries via bond purchases and structured derivatives with international banks. Many hedge funds also like to borrow TWD for carry trades, exploiting its weakness driven by government policy.
In early May, concerns emerged: what if Taiwan’s life insurers start selling U.S. Treasuries and repatriating funds into TWD? Hedge funds would have to unwind their carry trades. This triggered massive capital inflows into the TWD market, causing its sharp appreciation. I believe authorities chose not to intervene or increase TWD supply to reverse the flow. Perhaps they wanted to signal to the U.S. (especially the Trump administration) that they aren’t deliberately weakening the TWD but accepting its appreciation. I think this is the main reason behind the sudden surge, and further appreciation may continue.
Bonnie:
Do you think similar situations could occur in other parts of Asia?
Arthur Hayes:
This trend is already emerging. Similar dynamics are happening in South Korea, Singapore, Malaysia, and Thailand. These countries also maintained long-term weak-currency policies, accumulated large USD reserves, and made overseas investments. Now, capital is gradually flowing back home, triggering similar currency appreciation effects.
Will the U.S. Government Actually Buy Bitcoin?
David:
You mentioned a potential risk—if Democrats win the 2028 presidential election, they might cancel the U.S. Bitcoin strategic reserve. If the reserve is scrapped, do you think the market would face heavy sell pressure?
Arthur Hayes:
Possibly. It depends on how much Bitcoin the U.S. government actually holds and its fiscal condition. I don’t think their holdings reach 200,000 BTC (the amount seized through judicial actions). If the government faces budget pressures, they might sell these Bitcoins. So there’s uncertainty, but it could indeed become a source of funds.
David:
Could they instead buy more Bitcoin? After all, they haven’t actively done so yet.
Arthur Hayes:
I think it’s politically unfeasible for the U.S. government to actively buy Bitcoin. If the government spends public funds, it usually goes toward tax cuts, bridges, hospitals—projects benefiting the majority—not buying Bitcoin, an asset held by only a few.
Theoretically possible, anything can happen. But politically, it’s not wise. If the government has spare funds, spending it on Bitcoin clearly isn’t the best way to win voter support.
David:
But the government has already won votes through other policies, so they don’t need to do this.
U.S. Financial Regulation and Money Printing
Bonnie:
You mentioned the U.S. might implement capital controls, especially on foreign ownership of assets. Is that correct?
Arthur Hayes:
Yes. I think they might start by removing the “withholding tax exemption.” Currently, foreign investors holding U.S. bonds don’t pay the 30% tax local investors do. Removing this could reduce the appeal of U.S. Treasuries for foreigners, pushing capital toward other investments. I believe this trend may gradually emerge.
Bonnie:
Would that cause the market to crash?
Arthur Hayes:
No. Even if foreign investors pull out, the U.S. government will print money to fill the gap and prevent major market turmoil.
David:
In fact, in early April we saw something similar—bond and stock prices both fell, Bitcoin yields dropped, while bond yields rose. So I wonder, if the U.S. implements capital controls, could it trigger a similar reaction—falling asset prices and reduced liquidity in the U.S. financial system?
Arthur Hayes:
I think capital controls will be rolled out gradually, avoiding sharp market swings. Authorities know sudden policy shifts could lead to unwanted outcomes—like severe bond market volatility or loss of control. With gradual implementation, they can offset outflows by having the Fed, Treasury, banks, or certain private credit-creating institutions step in for foreign sellers.
David:
Recently, we’ve seen renewed correlation among stocks, Treasury yields, and Bitcoin. Do you think this correlation will persist?
Arthur Hayes:
I don’t think so. Risk-off events may occur, increasing market volatility. In such cases, Bitcoin could play a bigger role as a hedge.
Buy All Assets? Buy Non-U.S. Assets?
Bonnie:
You previously said “buy all assets, experience American life.” Later you discussed a “breakup” between the U.S. and global capital. Do you think this relationship will continue or eventually split?
Arthur Hayes:
I think the relationship will gradually drift apart, but not as quickly as some predict.
Bonnie:
When might this “breakup” happen?
Arthur Hayes:
It might take decades.
Bonnie:
If foreign capital gradually exits the U.S. and flows back home, what impact would that have on the global economy? What would the scenario look like?
Arthur Hayes:
Currently, foreign capital flows into the U.S. because its markets perform relatively well—stocks, bonds, real estate—all attract heavy investment. If capital exits and returns home, U.S. market performance may suffer. But for emerging markets like Taiwan, Indonesia, or Thailand, this could be an opportunity. Capital inflows would push up local currencies, boosting consumer purchasing power. As spending rises, more people may invest and start businesses to meet new demand. This shift could energize emerging market economies and drive growth.
U.S. Stablecoin Bill
Bonnie:
Regarding the stablecoin bill, do you think it will force issuers to buy more U.S. Treasuries?
Arthur Hayes:
I don’t think so. I see the bill more as enabling banks to participate in Tether-like businesses. If I’m a bank, I can now create my own stablecoin and effectively collect deposits at zero cost. Plus, if the supplementary leverage ratio exemption is removed, I can use those deposits to buy U.S. Treasuries and earn steady returns.
Bonnie:
I heard a view from an exchange executive: other countries don’t need to try harder because the U.S. already dominates crypto and Bitcoin competition. After all, when people buy Bitcoin, the base asset is USDT, which is pegged to the dollar.
Arthur Hayes:
I disagree. In fact, one of the largest crypto trading markets globally is South Korean traders. So I don’t think the U.S. fully dominates—it’s just one player among many.
Open Interest Indicator
David:
Recently, Bitcoin futures open interest hit a record high. I checked my notes—on May 22, total open interest reached $89.8 billion, rising $15 billion in just five days, reflecting unprecedented leverage levels. What’s your take on this?
Arthur Hayes:
It simply shows growing market interest, right? Clearly, Bitcoin has hit new highs, and more leveraged positions are being built, with broad expectations that prices will quickly surpass $110,000 or higher. So I see this as a sign of optimism.
David:
Based on your past experience at BitMEX, what market reactions typically follow a surge in futures open interest?
Arthur Hayes:
A key thing to watch is the expansion of the “basis”—the premium of Bitcoin futures over spot prices. Currently, we haven’t seen extreme cases, like a 10%+ premium.
David:
In BitMEX trading, were there specific indicators you used to predict sharp volatility? Were they consistent?
Arthur Hayes:
To be honest, I never found any clear indicators for predicting such events. And frankly, I didn’t study the data deeply. So I don’t have conclusions to share.
Decentralized Exchanges Under Pressure (Hyperliquid)
Bonnie:
Recently, an incident involving the JellyJelly meme coin sparked debate over whether Hyperliquid is truly decentralized. If a centralized exchange can influence or manipulate you with $10 million, is using a DEX like Hyperliquid really safe?
Arthur Hayes:
Clearly, Hyperliquid may not be as decentralized as advertised. It appears the team prioritized protecting the purchasing power of their HLP token over strictly enforcing market-driven liquidation rules for the jelly token. From that angle, yes, it’s not fully decentralized. But on the other hand, it shows they highly value HLP, which underpins many market operations.
For me, this actually makes me more confident trading on Hyperliquid. After all, most traders don’t truly care whether a platform is fully decentralized—they care more about liquidity and diverse trading products. If Hyperliquid delivers these in a relatively decentralized way, that’s sufficient. We can trade there with confidence.
Fierce Competition Between Exchanges and Banks
Bonnie:
Many centralized exchanges are expanding into payments—it’s their natural next step. What’s your view on exchange evolution over the next decade?
Arthur Hayes:
I think the market is now in full competition. Exchange products show little innovation, and fees are largely identical. So marketing becomes the real battleground, especially in the U.S. Now, all banks offer similar brokerage services, making it harder for centralized exchanges to survive. If JP Morgan bans clients from buying Bitcoin, Coinbase and Kraken will struggle to maintain margins.
David:
Mentioning Coinbase, several major exchanges recently completed IPOs, accelerating crypto’s mainstream integration into the S&P 500. Do you think S&P 500 investors now need to realize they’re indirectly exposed to Bitcoin through these index funds?
Arthur Hayes:
I don’t think it’s noteworthy. Many investors simply buy index funds—they hold ETFs containing many assets, possibly misaligned with personal preferences. But they don’t care; they just want market exposure.
David:
About exchange development—now that CEXs are becoming mainstream, do you think they’ll draw deposits from regular users and traditional institutions like JP Morgan or Bank of America?
Arthur Hayes:
I don’t think so, because banks have stronger distribution networks than crypto firms.
David:
So, in the foreseeable future, won’t they form direct competition?
Arthur Hayes:
There is still direct competition. If JP Morgan lets users buy Bitcoin and Coinbase offers the same, users end up buying the same Bitcoin. Then competition boils down to trading fees. If JP Morgan offers zero-fee trading—since they profit from other banking services—while Coinbase still relies on high-margin brokerage, how will Coinbase respond?
David:
If you were to launch another BitMEX today, how would you prepare to capture crypto market traffic?
Arthur Hayes:
I’d focus on attracting more “Degens.” I wouldn’t compete in Bitcoin trading—that’s a losing business.
I’d concentrate on meme coins and new project launch platforms. I believe optimizing new token issuance processes can generate more revenue, rather than competing in low-margin, high-competition BTC/USD trading.
Squid Game in the Eastern World
Bonnie:
You’ve lived in Asia a long time. I’m curious—what have you learned about money and investing in Asia that’s fundamentally different from the U.S.?
Arthur Hayes:
I think Asians generally have lower trust in government, making them more cautious and skeptical in investing and wealth management. Their saving habits differ too—gold holds a key place in Asian households, and real estate investment is widespread. These mindset differences shape their unique investment behaviors.
Bonnie:
Are their investment styles more risk-seeking or conservative? Why is crypto trading volume so high in South Korea?
Arthur Hayes:
Several factors. First, South Korea has extremely high internet penetration, making online trading platforms easily accessible. Second, its gaming culture is strong, helping younger generations accept digital assets and virtual economies. Additionally, Korean society is relatively homogeneous and highly competitive. Despite high education levels, high-paying jobs are limited, making it hard for many to achieve financial freedom through traditional careers. So many turn to stock or crypto trading as a breakthrough. This intense competitive spirit drives trading volume growth.
Investment Views of the New Generation
Bonnie:
Older generations hold vast wealth and hope to sell assets to younger ones to fund retirement. But younger people aren’t eager to buy and accumulate—they prefer spending on experiences. How do you see this evolving?
Arthur Hayes:
I think watching regulatory developments in crypto and digital assets will be fascinating. Right now, baby boomers (born 1946–1964) hold large amounts of stocks, real estate, etc. But will anyone actually buy these assets? Maybe some young people want suburban houses or city apartments, but overall, I’m unsure. So if older generations need to sell these assets to fund retirement, but younger ones refuse to take them, that becomes a big problem. Worse, if asset prices fall, older people’s wealth shrinks, and they can’t afford retirement. Then governments might choose to print money to cover pension shortfalls, shifting the burden to younger generations. Will young people accept that? That remains unknown.
Bonnie:
So what do you think might happen?
Arthur Hayes:
I think intergenerational conflicts may erupt. I can’t predict the outcome, but I believe governments will likely resort to massive money printing. For them, it’s the simplest and most direct solution.
Arthur’s Fund Strategy
David:
What are the current asset allocation priorities for Maelstrom?
Arthur Hayes:
Most of our portfolio is in Bitcoin, with significant exposure to Ethereum as well. We’re also involved in project-specific investments, including advisory roles and direct stakes. For less liquid but promising projects like Ethereum and Pendle, we currently hold substantial positions.
David:
How often do you adjust your Bitcoin holdings?
Arthur Hayes:
We trade infrequently overall—maybe one or two major buys/sells per year, as we avoid excessive trading.
Our goal is to outperform Bitcoin’s returns. If we find a new project whose performance exceeds the Bitcoin capital we sold to invest, we reinvest the profits into more Bitcoin.
David:
We’ve spoken with some Bitcoin maximalists who argue the only way to beat Bitcoin is to buy more Bitcoin. What’s your view?
Arthur Hayes:
I don’t fully agree, as it depends on the timeframe. For example, a token rising from $7 to $300—if you invested at $7 and sold at $300, your return clearly outperformed Bitcoin during that period.
David:
Last question—what’s next for Maelstrom? Any new expansions or projects?
Arthur Hayes:
We’re launching an acquisition business. Specifically, we plan to raise investor funds to acquire certain crypto companies. We’ll restructure their management and focus on adding new revenue streams. In the future, we also plan to go public in the U.S. via SPAC. We’ve already identified a target company and are preparing fundraising, aiming to significantly boost profitability through this initiative.
David:
What types of companies and operations interest you?
Arthur Hayes:
We focus on businesses with stable cash flows and strong profitability. The company we’re targeting is financially healthy with solid cash flow, and we plan to acquire it at a reasonable price.
Join TechFlow official community to stay tuned
Telegram:https://t.me/TechFlowDaily
X (Twitter):https://x.com/TechFlowPost
X (Twitter) EN:https://x.com/BlockFlow_News
深潮TechFlow
