Arthur Hayes Exclusive Interview: ETH to $30,000; FLOP Will Surpass ETH

Azuma

Odaily资深作者

@azuma_eth

2026-08-24 09:03

This article is about 14233 words, reading the full article takes about 21 minutes

The Fed Won't Raise Rates; BTC to Hit New Highs This Year; Clarity Is Useless, Suggest Trump Simply Veto It...

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Core Views: Arthur Hayes believes that pressure in the U.S. Treasury market will force the Federal Reserve to implement yield curve control with unlimited money printing, injecting massive liquidity into the market, which will directly drive Bitcoin's price to soar. He also predicts that Ethereum, due to its lagging price performance, will outperform the broader market, and he introduced his new project, Flop Network, a payment network anchored to computing power designed to serve the AI agent economy.
Key Elements:
1. Macro Signals: The U.S. Treasury's expansion of its bond buyback program to $4 billion, though limited in scale, marks a policy shift. To address selling by foreign governments such as Japan, the Fed will ultimately remove the counterparty cap on buybacks and implement unlimited money printing.
2. Bitcoin Prediction: As the "pressure release valve" for liquidity infusion, Bitcoin's price will break its all-time high to around $126,000 by year-end; if the Fed explicitly shifts to YCC, the price could rapidly surge toward $500,000.
3. Ethereum Preference: Hayes is bullish on ETH because it has yet to break its 2021 high ($5,000), possesses the "Lindy Effect" (long operational history), and has the largest developer community. He expects it to outperform other large-cap assets in the rebound, with a target price potentially reaching $20,000–$30,000.
4. Regulatory Stance: He considers the U.S. "Clarity Act" "insignificant" for the crypto industry, noting that the government has poured real money into AI while offering no substantive support to crypto enterprises. He suggests Trump veto the bill.
5. New Project Flop Network: Aimed at building a spot market denominated in "computing power" (Flop), it uses a "useful proof of inference" consensus mechanism where miners complete tasks to earn tokens (FLOP). The airdrop ratio is approximately 20% of the 10-year supply, with the testnet expected to launch in October 2025 and the mainnet in Q1 of the following year.

Source: Altcoin Daily

Compiled by Odaily (@OdailyChina); Translated by Azuma (@azuma_eth)

Editor's Note: This is a translated transcript of Arthur Hayes' recent appearance on the Altcoin Daily podcast. In this interview, Arthur Hayes discusses the current shifts in macro liquidity and the major crypto market rebound, offers price predictions for mainstream assets like BTC and ETH, and reveals detailed design aspects of his new project, Flop Network.

The following is the original interview text, compiled by Odaily, with some content omitted for readability.

Macro Liquidity and the Current Rebound

(Background: Last week, the U.S. Treasury announced it would expand its buyback program for long-dated Treasuries to provide greater liquidity support to the bond market. According to the statement, the Treasury's liquidity support buyback scale for long-dated Treasuries will be "at least doubled," increasing from $2 billion to $4 billion, covering bonds with maturities ranging from 10 to 30 years.)

Host: Let's get started. Arthur, you began your career as a trader at Citigroup, right?

Arthur: Yes, at Citigroup and Deutsche Bank in Hong Kong.

Host: As someone from the traditional finance (TradFi) background, how do you think these traditional institutions currently view the headlines coming out of the crypto market? Looking at crypto in 2026, what's going through their minds?

Arthur: "Sustainability" — I think that's the buzzword being discussed across the entire traditional finance world right now.

The massive $40 trillion in U.S. debt, escalating interest expenses, and troubles in the sovereign debt markets of many other major countries have led them to worry: "Will the Treasuries I'm holding even be worth anything in 5 years? Will inflation spike again? Are my asset allocations correct?"

Obviously, after Treasury Secretary Scott Bessent initiated the bond buyback operation — or at least doubled the authorized buyback quota for long-dated Treasuries — the market's reaction confirmed exactly this.

All of this is fueling the panic: "Oh my god, I'm holding all this U.S. debt, but it's underperforming every other major asset class. Why am I still holding it?"

And it's been proven time and time again that when you actually need to sell and liquidate, the U.S. government won't even let you sell freely.

Host: So how do they view crypto assets? They're already overwhelmed by debt and Treasuries. Is crypto just not on their radar?

Arthur: No, I think crypto is precisely the only release valve — the purest outlet for central bank money printing. As concerns grow about the U.S. adopting implicit or explicit yield curve control (YCC), Bitcoin and crypto prices are that release valve.

So right after the Treasury's announcement, you saw an overnight spring-loaded rebound in crypto.

Host: I remember the buyback quota was only doubled to around $2 billion to $4 billion, which isn't exactly astronomical...

Arthur: Correct, going from $2 billion to $4 billion or a few billion isn't a huge amount in itself, but it sends a signal. It's a weather vane.

Furthermore, the Fed absolutely won't raise rates, even though based on inflation data, U.S. economic growth, and the 2-year Treasury yield being 50 to 60 basis points above the effective federal funds rate, they really should be hiking. No question about it. But why aren't they? Because the Treasury needs to issue a massive amount of short-term T-bills to perform various maneuvers in the market, since nobody wants to touch the long-end debt anymore.

Host: For newcomers who've entered the Bitcoin space in the last year or two and are still trying to understand macroeconomics, in simple terms, what does the Treasury buyback mean for them?

Arthur: It means more liquidity — more fiat chasing a limited supply of hard assets, and Bitcoin is one of them, so the price goes up significantly. This is replaying the script leading up to 2008, retracing the very path that gave birth to Bitcoin.

This is the ultimate thesis for why you invest in Bitcoin. When everyone suddenly realizes — "My god, these Treasuries aren't worth anything, I can't exchange them for any real assets, I can't even trade them properly because the market is so heavily manipulated. I need a true store of value, something that directly benefits from a flood of dollars chasing scarce assets" — the best option is Bitcoin.

That was its purpose at its birth in 2009, and it hasn't changed since. Of course, it will ebb and flow with liquidity cycles. But if you're talking about a critical moment that makes the whole world see "the Emperor has no clothes" — when the world's largest sovereign debt market has everyone panicking about imminent yield curve control (YCC), Bitcoin's price will quickly soar to hundreds of thousands of dollars.

Host: You were on the front lines during the 2008 financial crisis. Were they buying back bonds back then too? Was the market in the one to two years before the crash similar to now?

Arthur: When the 2008 crisis hit, the first thing they did was bail out Bear Stearns — well, not a direct bailout, but they had Jamie Dimon acquire Bear Stearns at a ridiculous bargain price of $2 per share, with the Fed providing massive loans. It was a complete gift package for JPMorgan.

That was the first warning sign. Then, priding themselves on free markets, they let Lehman Brothers fail, only to realize they couldn't afford the consequences of a free market.

Then the big bank CEOs got on trains — these big shots who would never ride trains under normal circumstances, forced to act humble because they were taking taxpayers' money — they rode trains to Washington, got on their knees, and secured a $700 billion bailout.

Then everyday people got furious: "Why do Goldman Sachs executives still get massive year-end bonuses while I'm losing my house to the bank just because I defaulted on my mortgage? They didn't pay back their debts either! Why do Goldman and AIG get government bailouts and walk away with money, while I end up on the street?"

This is the backdrop against which Bitcoin was born. I don't know Satoshi Nakamoto personally, but if you read the language between the lines of the whitepaper and look at the timing of its release, you'll understand that one of the direct catalysts for Bitcoin's creation was the U.S. completely reneging on its promise of sound money during its bailout actions following the 2008 crisis.

Host: Looking ahead to 2026, 2027, and beyond, what liquidity cards do they have left in their policy toolbox? What happens next?

Arthur: Obviously, the killer move Bessent hinted at is the FEMA repurchase facility.

Think about it. There are so many foreign governments holding U.S. debt, the most typical example being Japan — they hold roughly $1 trillion in U.S. Treasuries. Japan now needs to boost the yen, needs capital to flow back home to support re-militarization and subsidize citizens suffering from inflation. Japan has signaled it will adjust policies to encourage corporations, the private sector, and government-affiliated entities to sell off overseas assets (i.e., U.S. stocks and Treasuries), selling dollars for yen to bring back home for domestic investment. The EU, Germany, and many other regions are in the same boat — they all need to spend money, whether on military budgets or social welfare, and their vast assets are all parked in U.S. financial markets.

They have to sell, but America absolutely cannot afford for its biggest buyers to become its biggest sellers, because that would completely destroy the market. Over the past two to three decades, U.S. stocks and bonds have dominated precisely because these countries kept buying; once capital flows reverse, the stock and bond markets would be in a bottomless pit, something the U.S. absolutely cannot accept.

So they launched this measure — not quite a threat, but a reassurance: "Folks, we're going to lift the counterparty limits on the FEMA repurchase facility entirely (making it unlimited). If you want to sell your Treasuries, don't dump them on the market. Come directly to the Fed. The Fed will print dollars for you, and we'll keep rolling over this lending. You take those dollars and sell them on the FX market to get your own currency back."

The U.S. government wants a weaker dollar, and so does the rest of the world. This is an operation that weakens the dollar without backfiring on domestic U.S. financial markets, and the only release valve absorbing all this is the Fed's balance sheet.

I think this is a bigger signal than the Treasury buyback, even though they haven't fully implemented it yet. It requires behind-the-scenes consensus between Waller, John Williams, and Fed Vice Chair Jefferson. But they will eventually do it, perhaps announced at the Jackson Hole global central bank symposium.

Ultimately, Bessent has shown us the way — using unlimited Fed money printing to absorb potential selling pressure in Treasuries and other dollar assets, thereby massively expanding the balance sheet. That's the core macro narrative. The so-called buyback was just a test of the waters, showing us where their pain threshold lies — the 5% level on the 10-year Treasury yield. If yields show any sign of breaking above that level, they'll race down the money-printing path until they reach fully open yield curve control.

I Never Look at Technical Analysis

Host: Arthur, you're the inventor or one of the co-founders of perpetual contracts (Perps), right?

Arthur: That's right.

Host: Some people even call you the "Godfather of Perpetuals." Have you heard that?

Arthur: I have, thank you.

Host: Haha, that's from internet users, not me, but people do think that. For traders out there, what technical analysis setups (TA setups) do you think are particularly noteworthy for Bitcoin right now? When you look at Bitcoin's charts, what do you typically focus on?

Arthur: Honestly, I don't really look at technical analysis. I follow a guy named Milton Berg who does technical analysis on U.S. stocks. Right now, Bitcoin is more of a follower of the U.S. stock market. If the U.S. equity narrative breaks — because everyone is leveraged up holding the same things — when people get margin calls, they have to sell whatever they can sell, right? Bitcoin is a liquid asset, so you have to sell it. So I mainly follow his buy and sell signals.

As for myself, I don't do specific technical analysis on Bitcoin. I think $60,000 is a key level, $100,000 is obviously another, and the previous all-time high around $125,000 or $126,000 is also an important threshold. As for the fluctuations in between, I don't stress over short-term trading. That's not my style.

Host: I don't want to put words in your mouth, correct me if I'm wrong. Would it be fair to say that for any asset that has achieved product-market fit, the 200-day EMA is one of the most important technical indicators to watch?

Arthur: Maybe. But I can tell you, I never look at it.

What I value more are the "Vibes."

Host: Vibes?

Arthur: Yeah, macro narrative and intuitive vibes. I like looking at vibes because, at the end of the day, we all have to tell ourselves a logical story about why to buy and why to sell. Of course, the liquidity logic ideally aligns with some emotional atmosphere or trend, because you don't want to enter when vibes are extremely euphoric, but rather when the trend is just emerging from the surface and the asset is still unloved. That's why I like Ethereum. I believe it will outperform all other large-cap crypto assets in this round of liquidity-driven rebound.

Among Large-Cap Altcoins, I'm Most Bullish on ETH

Host: Okay, let's talk about that. Because in my view, if you had to choose another altcoin, all signals seem to indicate that ETH still has at least one more cycle, maybe even more room to grow... Major institutions are building chains on Ethereum, it also has the most stablecoins, buying ETH still seems like a very safe bet.

Arthur: Yes, Robinhood's RWA narrative is a nice story. Of course, the actual gas fees flowing to the base layer are very small, but that's not the point.

The point is the narrative. And in this cycle, ETH hasn't yet broken its 2021 all-time high of $5,000. By comparison, almost all other major ultra-large-cap crypto assets have broken their previous all-time highs this cycle. So ETH is lagging. That's what I like about it.

Also, I need to emphasize, ETH isn't going to zero anytime soon. I don't think I'll wake up one morning to find ETH suddenly down 75% due to some event — although, of course, the probability isn't zero. But Ethereum has been running since 2015. By contrast, some other blockchains have only existed for two years, three years, or even less. So the latter carries much more risk.

Therefore, in our portfolio, I'd be more comfortable allocating a larger notional position to a long ETH trade than any other crypto asset. The reason is simple: the Lindy effect. Ethereum has been around for that long.

Host: If someone asks you, "Why Ethereum?", how would you answer? Other chains have various features too — Solana is faster, others are flashier, etc. From your perspective, what matters more? Network size? Speed? Low cost?

Arthur: I think the question ultimately boils down to who has the largest developer community. The answer is Ethereum.

I don't care about all those flashy features. Name one DeFi infrastructure that was first created on a network other than Ethereum. The innovation energy is here, and the developer talent is here. Sure, some people take those ideas and package them more attractively on Solana or other platforms, and those people have made a lot of money. But that was over the past year or two. What has Solana done recently? Ethereum hasn't given me much to be excited about in the past four or five years either, but precisely because of that, I think it's the perfect candidate to outperform the market in the next phase.

Host: Hypothetically, if over the next 5 years (whether it's 2 or 5 years) Bitcoin goes to $200,000, where would Ethereum be price-wise?

Arthur: I don't know what the price will be, maybe $20,000, $25,000, or even $30,000.

Host: Based on historical trading patterns, like Tom Lee's logic of extrapolating from historical data — Ethereum is a high-beta asset to Bitcoin. If Bitcoin reaches that level, Ethereum's upside elasticity usually amplifies? Do you agree?

Arthur: Basically, yes. Think about it — Bitcoin Dominance is currently around 60%. During the "DeFi Summer" of 2020-2021, it fell to around 25%-26%. I don't think it will go back that low, but dropping to 40% is possible, and that process will be driven mostly by Ethereum. Because it's the largest asset, no other asset can rise enough in both magnitude and speed to meaningfully reduce Bitcoin's dominance.