Bitcoin may climb to fresh record levels in 2026 as dollar liquidity improves, according to Arthur Hayes, co-founder of crypto exchange BitMEX. Hayes believes Bitcoin’s weak showing in 2025 was driven by tight financial conditions rather than fading interest in the asset. Hayes said Bitcoin struggled last year because there was not enough dollar liquidity flowing through markets. When the money supply tightens, risk assets usually suffer.
Bitcoin fell more than 14% in 2025 when the US dollar’s liquidity worsened. At the same time, gold, being a safe-haven asset, surged by over 44%. Technology stocks performed well, with the sector leading gains in the S&P 500. Hayes noted that these assets benefited from different forces that did not support Bitcoin at the time.
According to Hayes, Bitcoin needs an expanding supply of dollars to regain strength. He said renewed liquidity would give investors the confidence to move back into scarce assets like Bitcoin.
The co-founder of BitMEX expects liquidity conditions to improve in 2026. One key factor could be an expansion of the US Federal Reserve’s balance sheet, which would inject more money into the financial system. Lower mortgage rates may also help free up capital and support borrowing activity.
Hayes also pointed to changes in how banks may lend money in the coming year. He expects more credit to flow into US government-backed and strategic industries, increasing overall liquidity.
Military spending could further support this trend. The co-founder of BitMEX said the US is likely to maintain high defense spending, which is often funded through the banking system. This adds money to the economy and supports conditions that benefit assets like Bitcoin.
Despite Bitcoin’s underperformance, Hayes urged investors not to turn bearish. He described Bitcoin as ‘monetary technology’ whose value is closely tied to fiat currency expansion. While Bitcoin holds value over time, reaching prices near $100,000 depends on sustained monetary easing.
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Other industry leaders agree with Hayes’ outlook. Venture capitalist Tim Draper recently repeated his long-term Bitcoin price target of $250,000, saying 2026 could be a breakout year. Abra CEO Bill Barhydt also believes easing monetary policy may revive risk appetite and support Bitcoin’s next major move.