Despite a 4.49% rise in the dollar liquidity index, Hayes maintains a bearish outlook on Bitcoin.

Arthur Hayes, co-founder of BitMEX, maintained his bearish outlook on Bitcoin (BTC), stating in a BlockBeats report dated the 3rd that weakness will persist until the Federal Reserve or banks expand their balance sheets. His comments came despite the US Dollar Liquidity Index (USDLIQ U) rising 4.49% year-to-date, with the index shown at approximately 32.71 million on the chart—up roughly 1.406 million from the start of the year. The index's year high stands at about 32.90 million and its low at about 31.27 million, leaving the current reading roughly 190,000 below the peak. The divergence between near-peak dollar liquidity and Hayes's bearish call underscores his view that balance-sheet expansion, not current liquidity levels, is the key driver for Bitcoin. Investors are watching for signals of Fed or banking-sector balance sheet expansion as the potential catalyst for a reversal in BTC's downtrend.