According to reports from Maelstrom, Arthur Hayes forecasts the EUR/JPY currency pair falling from approximately 185 to below 140 by June 2027. The Maelstrom chief investment officer argues this decline signals potential Federal Reserve money printing that could flow into Bitcoin and other cryptocurrency assets. Hayes positions this currency movement as a key indicator for unlocking fresh waves of crypto liquidity in the market, with the sharp decline potentially triggering a major injection of dollar liquidity that creates a bullish backdrop for Bitcoin and the broader crypto market.
As reported by Maelstrom, the forecast is linked to US Treasury Secretary Scott Bessent's currency strategy. In July, the New York Fed sold euros to help fund Japan's yen rescue using the Treasury's Exchange Stabilization Fund (ESF) rather than dollars. Hayes argues this reallocation previews a pattern where allies receive dollar liquidity without official Fed balance sheet expansion. The Fed's growing use of repo market purchases to backstop Treasury demand supports this analysis, with Hayes noting that Treasury Secretary Bessent is pursuing moves aimed at pushing the cross lower.
According to Maelstrom's analysis, the EUR/JPY decline rests partly on France's economic conditions. Hayes describes France as Europe's weakest economy, citing government spending near 60% of GDP and reliance on foreign capital, mainly from Germany and Japan. He notes that France's Target2 balance has shifted from net creditor to the largest debtor, while French bank stocks have already started to fall. Hayes argues that France's widening bond yields and fragile banks could force the Banque de France into unofficial stimulus ahead of France's 2027 presidential election. He cites a widening gap between French and German bond yields, which he says is near its widest level since the 2011 euro crisis.
As reported by Maelstrom, Arthur Hayes and his family office hold Bitcoin as a structural long regardless of short-term price swings. The analysis acknowledges significant uncertainties, noting that whether the euro cooperates with Hayes' timeline remains unverified and speculative. However, the report emphasizes that if EUR/JPY continues falling through next year's French elections, that alone could serve as a tell for liquidity acceleration. Hayes has positioned specific crypto assets, holding short-term positions on Ethereum with a $10,000 target, Ethena at $0.50, and Ether.fi at $2. Crypto traders may need to monitor this currency pair rather than traditional ETF flows for their next liquidity cue.
