Arthur Hayes, Chief Investment Officer of cryptocurrency venture capital firm Maelstrom, says he doubts Donald Trump’s administration will get around to creating a strategic Bitcoin reserve, a policy many crypto enthusiasts are pinning their hopes on.
“I don’t think Trump is going to get away with making a bitcoin reserve,” Hayes, co-founder and former CEO of BitMex, said in an interview. “At the end of the day, I don’t know how borrowing money to buy bitcoin helps any of Trump’s platforms.”
Trump certainly sees the benefit crypto can bring him, having launched a few lucrative meme coins (crypto tokens with no use other than being volatile speculative instruments) before his inauguration. For die-hard Bitcoin supporters, a US strategic reserve held in BTC would be something of an apotheosis for the most valuable token.
Hayes said, “I hope I’m wrong,” regarding the implementation of a BTC reserve. But he pointed to the limited time frame before the midterm elections, which could limit the ability to implement significant policy changes, as well as the fact that there are many other things to allocate time and money to.
“You only have so much borrowing capacity before you destroy the bond market. Want to borrow money to buy bitcoin? Do you want to borrow money to provide health care to the elderly who voted for you, or to build more bombs so the defense lobby likes you? Hayes said.
“There are many different things you can borrow money to spend it on. I just don’t think he wants to spend it on bitcoin. While as important as bitcoin bros think they are, there are many other interested parties who want the borrowed money to go into their pockets,” he added.
Hayes could be called a contrarian. Impish irreverence when it comes to investing via his new Maelstrom fund – “We love underrated shit” [shitcoins] – is supported by penetrating insights into macroeconomics, with particular pessimism about how governments are eroding the wealth of everyday people.
Maelstrom mostly writes checks in the $50,000-$100,000 range on early-stage crypto projects and acquires tokens instead of equity; recent successes included investing in Athena Labs, the stablecoin project.
Speaking about Maelstrom’s investment thesis, Hayes said: “Let’s not kid ourselves, this is raw speculation. Most of these things are going to be zeroes. And so I don’t want to dress it up in some kind of highfalutin language. We’re speculating. “
