Bitcoin's Weakness Likely to Last Until Fed or Banks Grow Balance Sheets: Hayes

Arthur Hayes sees Bitcoin (BTC) staying weak until either the Federal Reserve or banks begin to expand their balance sheets. A gauge of dollar liquidity has already risen by about 4.5% this year.

The call was posted to X by Hayes, co-founder of BitMEX and chief investment officer of the family office Maelstrom. That leaves Bitcoin holders facing both a higher liquidity gauge and the balance-sheet condition Hayes identifies as the source of the weakness.

What Is Behind Arthur Hayes' Bitcoin Caution as Liquidity Rises?

In his post, Hayes referred to the .USDLIQ index, a dollar-liquidity gauge.

The gauge stood at 32.71 million on November 2, having advanced 4.49% since January. It remains roughly 0.6% below its October peak of 32.90 million, however.

A central bank or a lender expands its balance sheet when it buys assets or extends further credit. That process injects fresh money into the financial system.

His written commentary, in contrast, was short.

“USD liquidity is recharging. Expect $BTC weakness until Fed and or Banks start growing their balance sheet.”

USD liquidity is recharging. Expect $BTC weakness until Fed and or Banks start growing their balance sheet.

— Arthur Hayes (@CryptoHayes) November 3, 2026

Had Hayes Already Withdrawn From the Market?

On October 15, Hayes urged traders to take long positions in Bitcoin and Ethereum (ETH). The recommendation was tied to an anticipated multi-trillion-dollar bailout after the artificial intelligence (AI) data-center boom.

A few days later, roughly $22.28 million in crypto was sold from Maelstrom's directional book, the portfolio devoted to outright price bets. Hayes further confirmed on X that he plans to remain out of the market.

This is not the first time Hayes has connected crypto with Fed money creation. In September, he made the case that a softer euro against the yen could signal Fed money printing, giving crypto a lift.

Bitcoin has on occasion fallen behind liquidity-style signals. In September, it trailed a record global money supply of $103.66 trillion.

For Hayes, what drives Bitcoin's next move is the state of Fed and bank balance sheets, not liquidity readings. Until those balance sheets expand, his position stays cautious.