In 2017, the block size debate split the community, and BTC rose from 1000 to 20000.
In 2020, the pandemic shattered the world, and BTC rose from 3000 to 69000.
In 2023, the FTX collapse combined with the central bank's aggressive rate hikes, and BTC rose from 16000 to 73000.
The pattern is clear: every time a wall is climbed, there is 3 to 10 times the space behind it.
If you believe in this pattern, the current wall—AI bubble panic, rate hike expectations, geopolitical crisis—is being built brick by brick. Hayes is betting that the day this wall is completed will be the starting point for climbing over it.
CME FedWatch shows the probability of a rate hike in December—not a cut, but a hike—is as high as 69.2%. The probability of maintaining rates in October is 82.3%, but the cumulative probability of a 25 basis point hike by December has already surged to 64.1%.
Last night's liquidation data is even harsher: $1.16 billion in derivatives liquidations, of which $1 billion were long positions. 166,000 investors were forcibly liquidated within 24 hours. The Philadelphia Semiconductor Index dropped over 2%, with ARM and Nvidia falling across the board.
The market is saying: Don’t talk to me about money printing three years from now; I need to survive this month.
Hayes is calculating the long-term liquidity account. The rate hike cycle will eventually end, and debt pressure will eventually force the central bank back to the money printer. This endgame judgment is likely correct.
The market is calculating the short-term risk account. A 69% chance of a rate hike in December, chip stocks bleeding, and long leverage not yet cleaned out. These are also true.
Contradictory? No. They just differ by a 6 to 12 month time dimension.
But there is one variable that could make Hayes’s scenario play out earlier.
On October 8, Trump said there would be no strike on Iran before the midterm elections. But the Pentagon has already instructed Central Command to complete combat preparations, planning strikes on Iran’s missiles, drones, and energy facilities.
Peace on the lips, knives in the hands.
US Treasury Secretary Janet Yellen warned: if China does not relax rare earth export controls, the US may expel "hundreds of thousands" of Chinese students.
The US-Canada trade war hasn’t stopped. AI data center construction is competing with residents for electricity, and rising electricity prices are already pushing inflation higher.
These things are the real bricks of the wall Hayes is talking about.
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