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BitMEX Founder’s Tweet: Powell and the Future of the Banking System

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According to reports, Arthur Hayes, founder of BitMEX, tweeted, \”Powell may have pierced the banking system crisis in the United States. In 2008, the bank\’s no…

BitMEX Founders Tweet: Powell and the Future of the Banking System

According to reports, Arthur Hayes, founder of BitMEX, tweeted, “Powell may have pierced the banking system crisis in the United States. In 2008, the bank’s non-performing credit portfolio — also known as the subprime crisis. In 2023, the bank’s long-term bond portfolio, such as UST and MBS? If it falls sharply, please remember that in March 2020, it fell sharply, rescued the market, and then rose sharply!? I am ready.”

Founder of BitMEX: Powell may have pierced the banking system crisis in the United States

Analysis based on this information:


In a recent tweet, Arthur Hayes, the founder of BitMEX, discussed the potential crisis that might arise in the US banking system due to its long-term bond portfolio. Hayes compared this potential crisis to the subprime mortgage crisis of 2008 and highlighted the role of Jerome Powell, the chairman of the Federal Reserve, in mitigating the previous crisis.

Hayes hinted that Powell’s actions in March 2020, when he rescued the market by sharply cutting interest rates and implementing monetary policies, have temporarily alleviated the concerns. However, the future risks remain. Hayes argues that the current non-performing credit portfolio is similar to previous subprime mortgages, which raised doubts on the stability of the banking system.

The idea behind Hayes’ tweet is that Powell may have addressed the immediate threat of economic turmoil, but it is the long-term bond portfolio where the real financial risk lies. According to some analysts, the US banks have significant exposure to these long-term bonds, which mainly include the U.S. Treasury Securities (UST) and Mortgage-Backed Securities (MBS). The performance of these securities largely determines the stability of the financial sector.

It should be understood that Hayes’ tweet is not just a prediction of the potential risks. Rather, it calls attention to the critical role of regulators, central banks, and other stakeholders in managing the potential risks. In this context, Powell’s timely action in early 2020 is a noteworthy example of how policymakers can take effective measures to control the adverse effects of an economic crisis.

In conclusion, Hayes’ tweet is a signal for investors, policymakers, and regulators to be vigilant about the stability of the banking system. It reminds us that the current non-performing credit market may represent only the tip of the iceberg, and it is the long-term bond portfolio that could potentially cause the next banking crisis. However, it also highlights that regulatory measures and the right monetary policy can play a crucial role in mitigating the risks.

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