BitMEX co-founder Arthur Hayes argues that lower energy costs could allow Washington to expand credit without market constraints, creating conditions for Bitcoin price appreciation. His analysis follows U.S. control of Venezuelan oil assets and focuses on how suppressed crude prices might enable loose fiscal policy ahead of the 2026 midterms.
What Happened: Venezuelan Oil Control
U.S. President Donald Trump confirmed Jan. 3 that Nicolás Maduro and his wife were seized by American officials following attacks in Caracas.
Trump stated Washington would be "strongly involved" in Venezuela's oil sector, a development that spread rapidly across trading desks and social media.
Bitcoin slipped from just under $91,000 to approximately $89,000 immediately after the news broke.
By Jan. 4, the cryptocurrency rebounded to a multi-week high near $92,000, adding roughly $3,000 from its post-attack low.
Hayes posted a lengthy analysis of the situation.
His core argument centered on U.S. political incentives: keeping gasoline prices low matters more to voters than most policy debates. Thus, control over Venezuelan supply could help restrain energy costs while expanding credit elsewhere, Hayes claimed.
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Why It Matters: Liquidity Expansion
Hayes believes suppressed oil prices remove market forces that would normally compel politicians to "stop printing money."
He argued that "because of the energy used running computers engaged in proof of work mining, Bitcoin is the purest monetary abstraction there is," adding that "the price of energy is irrelevant to the price of Bitcoin as all miners will face a parallel shift up or down in the price at the same time."
He noted that if crude "rises too quickly and too high because of an expansion of economic activity, which is itself a derivative of energy, a politician must get the price lower somehow (e.g. stealing oil from other nations or slow down credit creation), or face expulsion from office."
Hayes referenced his "USD Liquidity Conditions Index" as evidence that Bitcoin's price rises directly in response to dollar liquidity expansion.
He said "the 10-year treasury yield and MOVE Index, which measures US bond market volatility, will tell us when the oil price is too high."
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