BitMEX’s Arthur Hayes: Bitcoin the Antidote for Fiat Banking Woes

• BitMEX’s Arthur Hayes believes Bitcoin is the perfect antidote for the “flawed, corrupt, and parasitic” fiat banking system.
• Hayes claims that the same approach used to reduce inflation in the US several decades ago won’t work this time around due to a significantly higher debt profile.
• Federal Reserve plans to tighten monetary policy by raising interest rates and reducing its balance sheet are expected to benefit asset holders more than anyone else.

Bitcoin as Antidote for Fiat Banking System

BitMEX founder Arthur Hayes has suggested that Bitcoin can act as an antidote for a fiat banking system he describes as „flawed, corrupt, and parasitic“ in nature. He believes that the value proposition of Bitcoin grows stronger as the banking system falters. Federal Reserve chairman Jerome Powell has faced significant criticism for his stance on implementing an approach which helped eliminate inflation in the United States several decades ago. However, Hayes points out that current economic and monetary conditions are vastly different from those in 1980 when inflation was last tackled – with today’s debt profile being four times larger than it was over 40 years ago.

Fed’s Monetary Policy

Fed plans to tighten monetary policy by raising interest rates and reducing its balance sheet could result in more stimulus being handed over to rich asset holders according to Hayes. The executive suggests that it would be difficult for the Fed to succeed if it continues using the same playbook given today’s inflated debt levels.

Benefits of Crypto

The mishaps of fiat systems could be remedied with crypto assets such as Bitcoin according to Hayes who said “Bitcoin’s value proposition lies in its ability to counteract a fiat system… which is flawed, corrupt, and parasitic.“ This means that investors may find greater appeal in digital currencies than traditional financial instruments due their decentralized nature and lack of reliance on third party intermediaries or governments/central banks.

Criticism Towards Powell

Powell has been at receiving end of significant backlash for his stance on tackling inflation similar way as done during 1980s despite difference between then-and-now condition such as quadrupled national debt since then. While placing emphasis on controlling both quantity & price of money, many think that Feds are stuck between rock & hard place while attempting such policies under present circumstances – where more stimulus is likely headed towards rich assets holder instead common people without proper relief package during pandemic period.


Hayes‘ blog post titled ‚Kite or Board‘ highlights how drawbacks of conventional banking systems may result into advantages for cryptocurrencies like Bitcoin which can provide an alternative form of finance free from control from central authorities or third parties. The idea here is that crypto offers investors safer investment options compared with traditional financial instruments due their decentralized nature & lack of government interference – consequently making them attractive option during times when national debts have soared beyond what they were 40 years ago & governments are unable to effectively address crisis like COVID-19 pandemic situation with less effective solutions like increasing interests rate & reducing balance sheets etcetera