While gold experienced a remarkable surge of 120% during 2025, Bitcoin's price remained largely stagnant, a divergence that caught the attention of market observers. Arthur Hayes, co-founder of BitMex and CEO of Professional Capital Management, analyzed this uneven performance in a recent essay, emphasizing the critical role of dollar liquidity in shaping Bitcoin's market behavior.
Hayes contends that Bitcoin's price movements are closely linked to the availability of liquidity in U.S. dollars. Specifically, periods when the money supply contracts tend to coincide with declines or stagnation in Bitcoin, whereas expansions in liquidity are followed by Bitcoin rallies. The flatness of Bitcoin's price amidst a gold boom and rising tech equities, Hayes explains, stems from its lack of access to factors that benefited those assets.
One driver behind gold’s dramatic ascent was central bank activity, notably the significant divestment of U.S. Treasury securities. This shift followed a sweeping $300 billion asset freeze imposed on Russia in 2022 and was exacerbated by Venezuela's recent military undertaking. These geopolitical tensions intensified a global pivot toward non-confiscatable assets such as gold.
In contrast, the technology sector experienced sustained gains, buoyed by political actions that elevated artificial intelligence to a national priority status under President Donald Trump's administration. This governmental emphasis on AI likely underpinned the steady rise of technology stocks during the same period.
Bitcoin, however, did not benefit from either central bank asset reallocations or targeted political priorities. Consequently, its price trend largely mirrored the contraction of dollar liquidity in 2025, lacking additional catalysts for growth.
Projected Drivers of Dollar Liquidity Expansion in 2026
Looking ahead, Hayes identifies three principal mechanisms he expects will inject substantial liquidity back into the U.S. financial system starting in early 2026.
- Federal Reserve Policy Shift: In December, the Federal Reserve halted its reduction of its balance sheet. It simultaneously initiated a new program designed to introduce at least $40 billion per month into financial markets, thereby expanding money supply.
- JPMorgan Chase’s Strategic Loan Program: The major banking institution launched a $1.5 trillion lending initiative targeting sectors designated as "strategic" by government authorities. Since bank loans effectively create new money upon issuance, this program is expected to substantially increase liquidity. Supporting this, Federal Reserve data reveals that bank lending resumed growth in the fourth quarter of 2025 after a year-long contraction.
- Housing Market Stimulus: President Donald Trump mandated that government-sponsored enterprises Fannie Mae and Freddie Mac acquire $200 billion in mortgages. By lowering mortgage rates, this move makes it more advantageous for homeowners to borrow against home equity. Hayes interprets this as a form of stimulus intended to energize spending during an election year.
Unpacking the Drivers of Gold’s 2025 Rally
Further insights into the gold rally are derived from December trade data. The U.S. trade deficit contracted by 11% to $52.8 billion, marking the narrowest shortfall since June 2020. This improvement was more than fully attributable to increased gold exports, as reported in Commerce Department data and referenced by the Financial Times.
Despite this rally, a divergence exists in retail investor behavior. Holdings of the SPDR Gold Trust (NYSE: GLD), a leading gold exchange-traded fund, continued to decline. This suggests that momentum among individual investors has yet to build significantly, leaving potential for further price acceleration should retail demand increase. Hayes projects that should the current pace of central bank gold purchasing persist, the precious metal’s price could escalate to $12,000 per ounce.
Strategic Bitcoin Exposure Amid Market Conditions
In light of expected liquidity increases, Hayes disclosed his investment in companies employing leverage to gain exposure to Bitcoin. Specifically, he has acquired shares in Strategy Inc. (NASDAQ: MSTR) and Metaplanet Inc. (OTC: MTPLF). These firms utilize borrowed capital to purchase Bitcoin, a strategy aimed at amplifying returns should Bitcoin prices rise. Currently, both stocks trade near two-year lows relative to Bitcoin’s price, which, according to Hayes, positions them for outperformance if Bitcoin recovers to around $110,000.
Hayes, who manages the Maelstrom fund, acknowledges he is nearly fully invested yet intends to increase risk exposure resting on the premise of an imminent liquidity wave. His perspective strengthens the narrative that Bitcoin may be poised for a resurgence as monetary conditions evolve.
Anticipating Market Direction in 2026
Bitcoin’s price nadir coincided with the trough in dollar liquidity observed in late 2025. Since that point, liquidity indicators have turned decisively upward, shaped by the Federal Reserve’s easing policies, resumption of bank lending, and housing market measures. In this environment, Bitcoin emerges as a leading asset reflecting leveraged bets on the expansion of monetary supply.
Other market indicators show Bitcoin trading at approximately $96,276, with modest declines. Financial instruments related to gold and leveraged Bitcoin exposure have also experienced price shifts, with SPDR Gold Shares (GLD) standing near $423.98 per share, Strategy Inc. (MSTR) around $170.88, and Metaplanet Inc. (MTPLF) at $3.87. These values underline the broader market context in which Hayes’s outlook is framed.
Given the evolving monetary dynamics, investors and market participants will be closely watching the interplay of liquidity, asset performance, and political-economic policies throughout 2026.