Arthur Hayes, co-founder of BitMEX, argues that Bitcoin's traditional four-year halving cycle no longer drives its market movements. Instead, Hayes suggests that global macroeconomic liquidity is the primary factor influencing Bitcoin's price. This perspective, detailed in his essay "Long Live the King!" published on October 9, 2025, challenges a long-held belief among many cryptocurrency traders.
Hayes believes that policy decisions in major economies like the United States and China are creating an environment of easier money. This environment, he contends, will continue to push Bitcoin's value higher, even as some market observers anticipate a typical cycle peak. He explicitly states that those who rely on the old four-year pattern "miss why it will fail this time."
Key Takeaways
- Arthur Hayes believes Bitcoin's four-year halving cycle is no longer the main price driver.
- Macroeconomic liquidity, influenced by US and Chinese policy, is now the dominant factor.
- Easier money policies are expected to support Bitcoin's price growth.
- Bitcoin's dollar value is directly tied to the supply and price of dollars.
The End of the Four-Year Bitcoin Cycle
Hayes's argument is clear: the cost and availability of money are the most important variables for risk assets. Bitcoin's value, when measured against the US dollar, moves with dollar liquidity. He states, "Bitcoin in the current state of human civilization is the best form of money ever created." However, he adds that its dollar price "will ebb and flow because of the price and supply of dollars."
He expands this view to include China, noting that the yuan credit impulse has historically either boosted or dampened crypto cycles. This happened alongside economic conditions in the United States. This broader perspective moves away from the idea that protocol events alone dictate market behavior.
Fact: Bitcoin Halving
The Bitcoin halving event reduces the reward for mining new blocks by half. Historically, these events, occurring approximately every four years, have been seen as catalysts for significant price increases due to a reduction in new supply.
Historical Cycles and Liquidity
To support his claim that halving-based timing is outdated, Hayes reviews four distinct periods in Bitcoin's history. He connects each period to shifts in dollar and yuan liquidity. This analysis aims to show that monetary policy, not just the halving, has always been the underlying driver.
- Genesis Cycle (2009–2013): This period saw a boost from post-Global Financial Crisis quantitative easing and a rise in Chinese credit. Both factors slowed down by 2013, which Hayes attributes to "popp[ing] the Bitcoin bubble."
- ICO Cycle (2013–2017): Hayes states this cycle was less about dollars and more about "a fuck ton of yuan sloshing around the global money markets." A spike in China's credit impulse in 2015, coupled with a yuan devaluation, fueled this period. The tightening of credit and higher U.S. interest rates eventually ended the run.
Understanding Credit Impulse
The credit impulse measures the change in new credit as a percentage of GDP. A rising credit impulse suggests more money is entering the economy, often stimulating growth and risk asset prices. A declining impulse indicates a slowdown.
- COVID Hoax (2017–2021): Hayes uses this term for the pandemic-era policy response. He points to "helicopter money" under President Donald Trump and a rapid doubling of the dollar supply, with interest rates held at zero. This environment propelled all risk assets, including cryptocurrencies, until inflation pressures forced tighter monetary policy in late 2021.
The Current "New World Order"
In the current "New World Order" phase, which began in 2021, Hayes argues that liquidity mechanisms, rather than halvings, explain Bitcoin's ongoing strength. He highlights the US Treasury's strategy of issuing more short-dated bills. This action effectively drained the Federal Reserve's reverse repo facility, releasing approximately $2.5 trillion of liquidity into the markets.
Hayes characterizes this as a deliberate political choice to "run the economy hot." This influx of liquidity provides a strong tailwind for risk assets like Bitcoin, irrespective of its internal protocol mechanics. The policy aims to stimulate economic activity and avoid a slowdown.
"The Fed resumed cutting interest rates in September even though inflation is above its own target," Hayes notes. "The administration seeks to lower the cost of housing and loosen bank regulation to spur lending to critical industries."
These policy signals, according to Hayes, are unambiguous: "money shall be cheaper and more plentiful." This shift in monetary policy provides a strong foundation for Bitcoin's continued appreciation.
China's Role in Global Liquidity
Hayes believes China will not experience the extreme credit expansions seen in 2009 or 2015. However, he also expects it will not hinder global liquidity. Beijing has faced deflationary pressures and challenges in its property sector. Despite these issues, Hayes anticipates a pragmatic approach from Chinese policymakers.
He predicts that "When the economic pressure proves too intense… Chinese policymakers print money." This means China may not be the primary driver of new fiat currency creation globally, but it will certainly not act as a negative force against it. This nuanced view suggests a supportive, if not leading, role for China in global liquidity.
Monetary Cycles as the Core Driver
The central idea behind Hayes's thesis is that all market cycles, including Bitcoin's, are fundamentally monetary cycles. They simply appear in different forms. Earlier Bitcoin peaks aligned with slowing dollar and yuan liquidity. The recent rally, however, reflects a new alignment of political priorities. These priorities favor easier money conditions, regardless of the Bitcoin halving schedule.
Hayes makes his point directly: "Listen to our monetary masters in Washington and Beijing. They clearly state that money shall be cheaper and more plentiful. Therefore, Bitcoin continues to rise in anticipation of this highly probable future." His concluding statement, "The king is dead, long live the king!" encapsulates his belief that the old rules are gone, and a new era of macro-driven Bitcoin growth has begun.
At the time of writing, BTC was trading at $122,147, reflecting the market's current valuation of the digital asset.
