BitMEX co-founder Arthur Hayes predicts that the upcoming debasement of fiat currency will lead to an increase in the prices of Bitcoin (BTC) and stocks.

In a recent analysis, the crypto veteran expresses his confidence that the economy is entering a new phase of inflation, and BTC will “regain its mojo.”

Hayes refers to projections from the Congressional Budget Office (CBO), which anticipates 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.

He explains, “There won’t be a recession. This doesn’t mean that a large portion of people won’t face financial difficulties, but the American economy will continue to thrive. I’m highlighting this because I believe that fiscal and monetary conditions are loose and will remain so. Therefore, holding onto cryptocurrency is the best way to preserve wealth. I am confident that today will resemble the period from the 1930s to the 1970s, and this means that, given the freedom to move from fiat to crypto, I should do so because debasement through the expansion and centralization of credit allocation through the banking system is imminent.”

The BitMEX co-founder also predicts that companies will artificially inflate their own stocks using cheap credit.

“Central bankers have created bank reserves by purchasing bonds, which has lowered the cost and increased the availability of credit. In private capital markets, credit has been allocated to maximize shareholder returns. The easiest way to boost stock prices is to reduce the number of shares available through buybacks. Companies that can access cheap credit can borrow money and buy back their stock.”

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