Fed’s Liquidity Shift May Drive Bitcoin’s Price Surge
Bitcoin is on track to surge past $110,000 before experiencing a pullback to $76,500, according to BitMEX co-founder Arthur Hayes. He attributes this potential rally to the US Federal Reserve’s shift from quantitative tightening (QT) to quantitative easing (QE), which could inject liquidity into the market and boost the cryptocurrency’s value.
“I bet $BTC hits $110k before it retests $76.5k. Y? The Fed is going from QT to QE for treasuries,” Hayes posted on X on Sunday.
Despite concerns over inflation and potential economic disruptions from tariffs, Hayes remains optimistic, dismissing their impact on Bitcoin’s trajectory. He believes inflationary pressures are temporary and unlikely to derail the cryptocurrency’s bullish momentum.
Bitcoin’s Recovery May Be Underway
Markus Thielen, founder of 10X Research, also predicts a Bitcoin rebound. In a report published on 23 March, he suggested that the recent downturn may have reached its lowest point, setting the stage for a recovery.
Thielen pointed to the Federal Reserve’s dovish stance on inflation and former US President Donald Trump’s flexibility on tariffs as key factors that could boost market confidence.
“The Fed signalled it might look past short-term inflationary pressures, laying the groundwork for potential future easing,” Thielen noted.
He also highlighted Bitcoin holders’ behaviour and the performance of exchange-traded funds (ETFs) as indicators of a sustained bullish trend. With large Bitcoin holders acting as long-term investors, Thielen believes the market is unlikely to enter a deep bear phase.
ETF Inflows Signal Growing Investor Confidence
The return of capital inflows to US-based spot Bitcoin ETFs is another bullish sign, suggesting reduced selling pressure from arbitrage-focused investors.
Data from Farside Investors reveals that US-listed spot Bitcoin ETFs saw approximately $744 million in net inflows last week. BlackRock led the charge, attracting around $537 million in new investments.
While Thielen remains positive about Bitcoin’s prospects, he acknowledged the absence of a “clear catalyst” for an immediate parabolic rally.
At press time, Bitcoin was trading at around $87,000, marking a 3.5% increase in the past 24 hours. The total cryptocurrency market capitalisation has also risen slightly to $2.9 trillion, reflecting renewed optimism among investors.
