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Arthur Hayes, former CEO of BitMEX, has strongly criticized Donald Trump’s proposed Bitcoin Strategic Reserve (BSR), calling it a political disaster in the making. In part two of his essay series The Genie, Hayes argued that a federal BTC reserve would destabilize Bitcoin’s price, turning it into a tool for political manipulation.
Bitcoin as a Political Weapon
[embed]https://twitter.com/CryptoHayes/status/1887277980319457615[/embed] The idea of a U.S. Bitcoin reserve was initially proposed by Senator Cynthia Lummis, who suggested the government buy one million BTC to create a digital gold reserve. However, Hayes dismissed the idea, warning that once the government stops purchasing, the market would crash. “Politicians would use BTC’s price surges for short-term gains and dump holdings when convenient,” Hayes wrote. He also predicted that future administrations could liquidate the reserve to fund various policies, causing mass panic in the market.
Regulation & the “Frankenstein Crypto Bill”
Hayes also criticized crypto regulations favoring centralized giants like Coinbase and BlackRock, calling them a “Frankenstein crypto bill.” He argued that such regulations stifle innovation and undermine decentralization.
Alternative Proposal: Bitcoin as a Reserve Asset
Instead of a Bitcoin reserve, Hayes suggested the U.S. Treasury gradually devalue bonds and shift to BTC. He believes this could push Bitcoin’s price to $1.8 million and establish it as a legitimate reserve currency.
Final Warning: Crypto’s Future Depends on Action
Hayes urged crypto holders to push for better regulations, warning that relying on politicians could harm the industry. “If you’re waiting for politicians to save crypto, you’re screwed,” he wrote. Disclaimer: The views and opinions expressed in this article are for informational purposes only and do not constitute financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.