BitMEX co-founder Arthur Hayes believes that the upcoming devaluation of fiat currency will cause the prices of Bitcoin (BTC) and stocks to rise. In a recent analysis, the veteran crypto expert expressed confidence that the economy is entering a new inflationary phase, and BTC will “regain its mojo.”

Hayes refers to projections from the Congressional Budget Office (CBO), which anticipate that the US federal budget deficit in the 2024 fiscal year will reach $1.9 trillion, the highest amount ever recorded outside of the COVID-19 years.

Explaining his viewpoint, Hayes states, “There will not be a recession. However, this does not mean that a significant portion of the population won’t face dire financial circumstances. Nevertheless, Pax Americana will continue to thrive. I am highlighting this because I believe that fiscal and monetary conditions will remain loose, making hodling crypto the best way to preserve wealth. I am confident that today’s situation will resemble the period from the 1930s to the 1970s, and this indicates that I should freely convert my fiat into crypto to protect against the devaluation resulting from the expansion and centralization of credit allocation through the banking system.”

Additionally, the BitMEX co-founder predicts that companies will artificially inflate their stock prices by utilizing cheap credit. He explains, “Central bankers have created bank reserves by purchasing bonds, which has reduced the cost and increased the availability of credit. In private capital markets, credit has been allocated to maximize returns for shareholders. The most straightforward method to boost the stock price is to reduce the available shares through buybacks. Companies that have access to cheap credit can borrow money and repurchase their own stocks.”

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