Bitcoin (CRYPTO: BTC) sits in a “no-trade zone” according to BitMEX co-founder Arthur Hayes, who outlines three scenarios that could force the cryptocurrency out of its current range as AI-driven deflation collides with Iran war dynamics.
The No-Trade Call
Maelstrom did minimal trading in the first quarter apart from slowly increasing its long position in Hyperliquid, Hayes said.
Two developments combined to produce a trading dead zone: AI agents destroying knowledge worker jobs and creating deflationary pressure, and the Iran war entering its seventh week with uncertainty around commodity flows through the Strait of Hormuz.
Hayes believes the quantity of money determines Bitcoin’s price, not its price. Bitcoin has no cash flows, so the discount rate derived from central bank policy rates is irrelevant.
But given Bitcoin’s fixed supply, its value in fiat terms depends on the total amount of fiat in existence.
Scenario One: Back To Normal
The war ends immediately and the pre-war status quo returns. However, the secular trend to replace expensive knowledge workers …