Remember when Bitcoin touched $80,600 and half the crypto timeline screamed that the bull market was dead? Yeah, me too. I was staring at the charts, coffee going cold, wondering if we’d really just seen the top at $109,000 a few weeks earlier. Then Arthur Hayes drops into a podcast and casually says, “Nah, that was the bottom. $250,000 by New Year’s is still the base case.”
I’ll be honest — my first reaction was to roll my eyes so hard I nearly saw my brain. But the more I listened, the more it actually started to make sense. And no, this isn’t just another crypto influencer yelling “to the moon” because he’s bag-holding. Hayes has been weirdly accurate before, and this time he brought receipts.
Why Arthur Hayes Still Believes in $250,000 Bitcoin
The core of his argument boils down to one thing most of us completely misread: the dip wasn’t about institutions suddenly hating Bitcoin. It was about liquidity, stupid.
Let me walk you through it the way he explained it — slowly, because I had to replay the podcast three times before the light bulb finally went on.
The Great ETF Misunderstanding
Everyone lost their minds this summer when BlackRock’s IBIT and the other spot Bitcoin ETFs were sucking in billions every week. “Institutions are coming!” we shouted. Whales! Pensions! 401ks! The narrative was delicious.
Turns out, the biggest buyers weren’t your traditional “buy-and-hodl forever” institutions at all. Look at the top holders of IBIT according to public filings: Brevin Howard, Millennium, Jane Street, Goldman Sachs, Avenir… ring any bells?
These aren’t endowment funds. These are some of the savviest hedge funds and market makers on the planet. And they weren’t going long Bitcoin because they believe in the revolution. They were running the oldest trick in the crypto arbitrage book: the cash-and-carry basis trade.
“They buy the ETF, short the CME future, lock in risk-free yield when funding is positive. When funding collapses, they unwind. Simple as that.”
When perpetual futures funding rates were through the roof (remember 60-100% annualized?), the trade printed money. But around October, funding flipped negative. Suddenly holding the trade was bleeding cash. So they unwound — fast. Sell ETF, buy back futures. Boom: $20-30 billion in selling pressure that had nothing to do with changing views on Bitcoin itself.
Retail saw the ETF outflows, panicked, and front-ran what they thought was “smart money” exiting. Classic case of misreading the room.
The $1 Trillion Liquidity Vacuum Nobody Talked About
But the basis trade unwind was only half the story. The other half? The U.S. Treasury literally drained close to a trillion dollars out of the financial system between July and November.
Here’s the part that actually blew my mind when I looked it up.
The Treasury General Account (TGA) — basically the government’s checking account at the Fed — had dropped dangerously low earlier in the year. So the Treasury went on a borrowing spree to rebuild it, issuing mountains of new bills and bonds. Every time they do that, money leaves the private sector and gets locked up in the TGA.
- July → November: TGA balance rockets from ~$400B to nearly $900B
- Fed still running QT (burning another ~$60B/month)
- Result: Roughly $1 trillion sucked out of dollar money markets in five months
That’s not some abstract macro thing. That’s real cash that hedge funds, banks, and money-market funds can’t use to buy assets anymore. Risk assets — Bitcoin, tech stocks, everything — felt the squeeze.
And guess what? That rebuilding phase is basically over. The Treasury has openly said they’re comfortable around $850-900 billion. Translation: the liquidity drain is done.
The Fed Just Stopped Burning Money
Oh, and the Federal Reserve quietly ended quantitative tightening. No more shrinking the balance sheet. They’re holding it steady now, which in practice means the spigot is slowly turning back on.
Combine that with the Treasury no longer hoovering up cash, and Hayes’ conclusion becomes pretty straightforward: dollar liquidity has bottomed, and the only way is up.
“We are essentially bottomed on the liquidity chart and the direction in the future is higher.”
Arthur Hayes, November 2025
What Happens Next? Credit Creation Takes Over
Hayes thinks 2026 is when things get really interesting. The Fed might be done cutting rates aggressively, but commercial banks are apparently gearing up for a lending boom — especially to the industrial sector.
JP Morgan analysts have floated numbers as high as $1.5 trillion in new corporate lending. That’s fresh dollars entering the system, looking for a home. And when there’s too much money chasing too few assets… well, you know how that story ends.
In Hayes’ words: “Once we actually start to see things actually happen, then we’ll start to see people price a bigger forward on where this dollar liquidity situation is.”
So Is $250,000 Actually Realistic?
Let’s do quick math. Bitcoin closed 2024 around $95,000 (assuming we’re roughly there now). To hit $ read $250,000 by December 31, 2025, we need roughly 2.6x from here in 13 months.
Historically? Child’s play.
- 2020-2021 bull run: 20x
- Early 2024 run from $40k → $109k: 2.7x in ten months
- Current cycle still has ETF demand, potential nation-state buying, corporate treasury adoption, etc.
More importantly, the liquidity backdrop Hayes describes would be the most favorable since 2021. And unlike 2021, we now have spot ETFs that can absorb literally hundreds of billions without the same premium/discount chaos of the Grayscale days.
Look, I’m not saying $250,000 is guaranteed. Crypto loves to humble everyone. But dismissing it outright because “it sounds crazy” ignores the actual mechanics at play.
The Bottom Line
The $80,600 low wasn’t the start of a bear market. It was the messy end of a liquidity squeeze that caught almost everyone by surprise — including a lot of pros.
The factors that caused the squeeze (Treasury rebuilding + QT + basis trade unwind) are either complete or reversing. The path of least resistance for dollar liquidity from here is higher, and Bitcoin remains the sharpest beta to global liquidity in existence.
Arthur Hayes isn’t backing off his call. If anything, he sounds more confident than ever.
And honestly? After digging into the data myself, I’m starting to think he might actually be right this time.
See you at $250,000.
