BitMEX co-founder Arthur Hayes warned that the US Federal Reserve could abandon its recent hawkish stance and effectively “print money” to help finance a US military campaign against Iran — a development he says would be bullish for cryptocurrencies.
In a Monday blog post, Hayes pointed to a pattern he sees dating back to 1985: US presidents who initiated major Middle East military operations were followed by Fed easing and an expanded money supply to support the fiscal burden. He cited the 1990 Gulf War, the global response after Sept. 11, 2001, and the 2009 Afghanistan surge as historical examples where monetary policy relaxed amid increased defense spending.
Hayes argued that the longer President Trump pursues costly operations in Iran, the likelier it becomes that the Fed will lower interest rates or increase liquidity to finance those efforts. He urged investors to be patient now and consider buying Bitcoin and high-quality altcoins aggressively only after clear signs that the Fed is loosening policy or injecting cash to back government priorities in the region.
He also outlined other scenarios that could prompt the Fed to ease: the rollout of a new liquidity facility Hayes calls Reserve Management Purchases, intervention to stabilize a Japanese bond-market disturbance, or a credit shock stemming from AI-driven job displacement.
This weekend, Israel and the US reportedly carried out airstrikes on Iran that sources said killed Supreme Leader Ali Khamenei — actions President Trump has vowed to continue. The strikes generated a surge in social-media talk of “World War 3,” though those mentions remained below the spike seen in June 2025 during an earlier 12-day Israel–Iran confrontation.
Market reaction to the reports was relatively muted: US stock futures opened slightly lower, oil receded about half of its initial gain, and the S&P 500 fell by less than 1%. Macro newsletter The Kobeissi Letter remarked that the market’s open was not consistent with a full-scale global conflict.
Readers are reminded that coverage of rapidly developing geopolitical and market events can change quickly. Independent verification of reports is recommended, and outlets covering these stories aim to maintain transparency and editorial standards.