The post Bitcoin “Very Bullish” If Fed Expands Balance Sheet via Yen Support appeared on BitcoinEthereumNews.com.

Arthur Hayes says yen intervention is bullish for Bitcoin only with Fed balance sheet expansion. Federal Reserve data shows foreign currency assets flat and liquidity still contracting. Analysts warn that rapid yen strength could trigger carry trade unwinds and pressure Bitcoin. Former BitMEX CEO Arthur Hayes says possible intervention to support the Japanese yen could benefit Bitcoin if it leads to new U.S. dollar liquidity.  His comment follows reports of New York Fed dollar-yen rate checks this January. Current Federal Reserve balance sheet data, however, shows no evidence of liquidity expansion. Hayes Links Yen Intervention to Liquidity Growth In a post on X, Hayes said potential support for the yen would likely require the Fed to sell dollars and buy yen, increasing liquidity in the financial system. Hayes pointed to the Federal Reserve’s weekly H.4.1 report as the key indicator to watch. He said an increase in the “foreign currency denominated assets” line item would signal that the Fed is expanding its balance sheet.  Historically, periods of balance sheet growth have coincided with stronger Bitcoin performance. Rate Checks Raise Speculation but Stop Short of Action Speculation intensified after reports that the New York Fed conducted dollar-yen rate checks yesterday, January 23. According to Grok AI, rate checks are often seen as a signal that authorities are closely monitoring currency markets. They often precede intervention but do not confirm that action has taken place. Japanese officials have also issued repeated warnings against excessive currency moves this month. The yen strengthened following these developments, briefly trading near 155.90 per dollar after a period of sustained weakness. Despite the signals, no official confirmation of U.S. or coordinated intervention has been announced. Balance Sheet Data Shows No Expansion Yet Federal Reserve data does not yet support the liquidity-driven bull case outlined by Hayes. The…

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Filed under: News - @ January 24, 2026 6:16 pm