Arthur Hayes, the co-founder of BitMEX, predicts that the upcoming surge in Bitcoin (BTC) will be driven more by U.S. political dynamics than by cryptocurrency fundamentals. He suggests that a Republican victory in 2028—referred to as “Team Red”—will almost certainly lead to aggressive monetary expansion, provided gasoline prices remain stable.
Hayes introduces what he calls the “10% rule,” linking increases in fuel costs to shifts in electoral outcomes. His analysis concludes that Trump’s political motivations are likely to encourage looser fiscal and monetary policies, which historically benefit Bitcoin and other high-risk assets.
In a detailed blog post, Hayes focuses on U.S. gasoline prices as a key indicator. He argues that if gas prices rise more than 10% during the three months leading up to an election compared with January levels, it often results in one or more branches of government changing hands.
To prevent such a shift in 2028, Hayes believes Trump must maintain an overheated economy without allowing fuel costs to escalate sharply.
Two elections concern President Trump: the midterms in November and the presidential race of 2028. Although he cannot run again himself after 2024 or seek re-election until then, his political base’s loyalty depends heavily on their own chances at winning future elections. Many have abandoned MAGA due to doubts about their electability if they continue following Trump’s directives. So what strategies can Trump employ to ensure undecided voters turn out favorably for Republicans both in 2026 and 2028?
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A Delicate Balance for Policymakers
According to Hayes, lawmakers face a tightrope walk: they need to stimulate credit growth and nominal GDP while keeping oil prices under control. A rapid increase in oil could push Treasury yields higher and cause bond market volatility—pressuring politicians into curbing stimulus efforts—a move Hayes thinks Trump would resist.
“The most probable scenario is subdued or falling oil prices combined with aggressive money printing reminiscent of 2020,” Hayes explains. This optimism stems from expectations around increased U.S.-controlled Venezuelan crude output boosting supply significantly.
The actual arrival of this additional supply is less important politically than calming inflation-sensitive voters ahead of elections.
Hayes highlights two critical indicators: the yield on ten-year Treasury bonds and the MOVE Index—which tracks bond market volatility—as signals policymakers watch closely. When yields near five percent accompanied by spikes in volatility occur, leveraged markets tend to unravel quickly forcing policy reversals; last year’s tariff-induced selloff serves as an example where rising bond volatility triggered swift changes under political pressure.
The Unique Position of Bitcoin
Within this context, Hayes argues Bitcoin behaves differently from traditional financial assets because all miners face energy cost fluctuations simultaneously; thus oil price swings impact fiat currencies more directly than BTC itself.
Instead Bitcoin’s valuation primarily reacts positively when liquidity expands or currency value declines due to inflationary pressures.
“This momentum is unstoppable,” writes Hayes echoing analyst Lyn Alden while describing how deficit spending combined with Treasury issuance alongside central bank purchases creates reinforcing cycles driving dollar supply growth—and consequently pushing cryptocurrencies like Bitcoin higher.
Diving into his trading approach for 2026,
Hayes reveals his firm Maelstrom maintains near-maximal risk exposure while holding minimal stablecoins.
Alongside accumulating BTC steadily,
he plans reallocations toward privacy-centric tokens plus decentralized finance projects expected outperform should credit expansion persist.
The overarching takeaway from Hayes’ perspective:
Political incentives during election cycles lean strongly towards stimulus rather than austerity,
making it prudent for investors
to remain optimistic about risk assets overall
and hold long positions specifically within Bitcoin portfolios.