[TOKEN2049] Arthur Hayes: “Altcoin Season Is Already Here—But Quality Is the Key”

At Token2049 Dubai on April 30, Arthur Hayes, founder of crypto investment firm Maelstrom and former BitMEX CEO, emphasized that today's market liquidity is not driven by the Federal Reserve, but by the U.S. Treasury.

In an exclusive interview with Tokenpost following his keynote, Hayes said, “Since late 2022, the Treasury has injected roughly $2.5 trillion in liquidity into the market by issuing short-term Treasury bills. This effectively unlocked capital tied up in the reverse repo market.” According to Hayes, this move has contributed to the broad rally across risk assets, including Bitcoin, equities, and gold.

While many investors continue to anticipate a Federal Reserve pivot—expecting rate cuts or a return to quantitative easing—Hayes argued that “it’s the Treasury, not the Fed, that's actually providing liquidity.” He also pointed to the Treasury’s buyback program starting in April 2025, which, although not formally QE, could have a similar stimulative effect on the markets by boosting asset prices.

“Even if QT Continues, Treasury Policy Can Loosen Liquidity”

“Market participants are too fixated on the Fed’s rate decisions and whether QT (quantitative tightening) will end,” Hayes said. “But in reality, liquidity hinges more on how the Treasury issues and buys back debt.” He noted that the Fed remains hawkish, but the Treasury’s direction is shifting toward more accommodative measures.

Hayes believes that April 2025 may mark the cyclical bottom of the market, making it a strategic entry point for reaccumulating risk assets. “When the Treasury signals it will ensure Treasury market functioning, investors should see that as a green light,” he said.

“Altcoin Season Has Already Arrived—The Real Issue Is Quality”

On the underperformance of altcoins in recent months, Hayes pushed back on the notion that the market is dormant. “Altcoin season already happened,” he said, citing examples like Hyperliquid, which surged tenfold from $3 to $30. “High-quality altcoins have already seen strong rallies.”

However, he warned that many venture-backed projects from 2023 and 2024 were flawed by design, with high FDVs (fully diluted valuations) and low float structures. “These tokens lacked users, revenue, and demand—so of course their prices collapsed,” Hayes said.

“Rotation Toward Real-Yield, High-Quality Projects Is Next”

Looking ahead, Hayes predicted Bitcoin dominance could climb as high as 70% before capital starts rotating back into altcoins with real usage and revenue models.

“In the next phase, projects that actually generate profits and return them to token holders will stand out,” he said. “This won’t be a short-term trend—it marks the beginning of a revaluation based on fundamentals.”