Arthur Hayes is Against a Strategic Bitcoin Reserve

Arthur Hayes is not a man encumbered by faith in politicians or politics.

That’s why, in his latest blog post, Hayes lays out a case against one of the most popular crypto wishes, a strategic Bitcoin reserve. He also goes on to pour cold water on the idea that a crypto regulatory framework will benefit everyone.

Hayes, who recently predicted that Bitcoin could trade as low as $70,000 in the near future, said the crypto community needs to rethink its wishlist.

“Many misguided crypto folks wish for the US government to print dollars and purchase Bitcoin as part of a national stockpile and to enact regulatory moats around crypto businesses in which they have a financial interest,” Hayes wrote. “I believe these folks are asking for the wrong things.”

Instead, he says, “let’s do the hard thing and ask… for something that cannot be easily undone by the next administration, regardless of its political party affiliation.”

Strategic Bitcoin Reserve

Hayes’ main problem with a strategic reserve is that it can be sold just as easily as it can be bought.

“The fundamental problem when a government stockpiles any asset is that they buy and sell the asset primarily for political, and not financial, gains,” he said. “Does Bitcoin in and of itself do anything for the US government when considering the current structure of the global economic system? No.”

What it does do is pump Bitcoin’s price while the government is buying its billion-dollar hoard.

A less crypto-friendly administration in the future might look at the reserve as “easy piles of cash to spend on goodies for their supporters,” he said. That is, after all, the first goal “of any politician, regardless of the political system in practice.”

‘Frankenstein’ Crypto Bill

Hayes isn’t against good crypto regulation. It’s just that from his perspective, he sees a complex regulatory regime influenced by wealthy, centralized crypto companies rather than people building decentralized technology in the near future.

“Unfortunately, those building truly decentralized tech and applications do not have the financial resources to play politics at this juncture of the cycle,” Hayes said. “And so, the crypto regulatory wishes likely to be granted, if any are granted at all, will be in the form of overly complicated, prescriptive rules that only large and wealthy centralized companies can afford.”

More specifically, those who can afford the white-shoe lawyers who can work the system with alphabet-soup regulatory agencies.

“I believe this type of regulation does nothing to alter the status quo, and while it’s not directly negative to crypto, it ain’t positive either,” he said. “Monopolistic businesses cosseted by an impenetrable wall of gobbledygook regulations don’t look kindly on actual innovation.”

What they do, Hayes said, is use their privileged access to the system “to chase away would-be usurpers. You, the startup founder, might have flown to JFK in business class, but you definitely will leave in economy.”