Arthur Hayes predicts EUR/JPY decline to 140 by next June as a bullish catalyst for Bitcoin, citing funding stress at French banks and potential Fed money printing.
Macro & Markets ·
Arthur Hayes, chief investment officer of crypto family office Maelstrom, argues that traders should monitor the euro-yen exchange rate rather than Federal Reserve Chair Kevin Warsh's recent comments as an early warning system for dollar liquidity shifts. Hayes predicts EUR/JPY will decline to 140 or lower by June 2025, a move he ties to Treasury Secretary Scott Bessent's currency strategy and routing of allied capital through the Fed's FIMA repo facility. Hayes sees this dynamic as ultimately bullish for Bitcoin and crypto markets.
The mechanism hinges on French banking exposure to US repo lending. BNP Paribas, Credit Agricole, and Societe Generale collectively represent roughly one-fifth of that market, and Hayes flags widening French government bond spreads and capital outflows as signs of foreign lender retreat. Should these institutions reduce repo activity, he expects the Fed's RPM program—which currently absorbs 39% of T-bill issuance—to expand significantly, potentially growing the balance sheet toward $100 billion monthly versus its recent $22 billion pace since December.
Hayes maintains a long-term bullish Bitcoin position for his portfolio despite near-term volatility following Warsh's Jackson Hole speech, which preceded sharp price declines. His stated year-end 2026 targets include $10,000 for ETH and $0.50 for ENA, though whether those levels materialize depends on whether French bank stress actually materializes and whether policy responses unfold as he forecasts.