• BitMEX co-founder Arthur Hayes is bullish on Dogecoin (DOGE) and Pendle (PENDLE), adding to his holdings despite a recent market downturn.
• Hayes recently locked up $8.4 million worth of PENDLE tokens and predicts further upside potential for these assets this cycle.

BitMEX co-founder Arthur Hayes is expressing increased bullish sentiment on Dogecoin (DOGE) and Pendle (PENDLE) despite the recent crypto market downturn.

Hayes shared with his 524,900 followers on the social media platform X that he sees further upside potential this cycle for memecoin DOGE and Pendle, which enables users to tokenize and sell future yields, as reported by Crypto News Flash.

At the time of writing, Dogecoin (DOGE) is trading at $0.12, up over 2% in the last 24 hours, while PENDLE is trading at $5.65, up nearly 13% on the day. As an advisor for the Pendle project, Hayes recently locked up $8.4 million worth of PENDLE tokens until September 5 of this year.

PENDLE, the platform’s native token, can be used to earn rewards by providing liquidity to the protocol. Locking up PENDLE tokens, which can be done for up to two years, allows users to vote on governance proposals and earn 3% of all yield accrued by its yield-bearing tokens (YT).

Additionally, Hayes expressed bullish sentiment on Ethereum (ETH) competitor Aptos (APT), predicting that the layer-1 (L1) smart contract blockchain will overtake Solana (SOL) within one to three years.

Arthur Hayes Expects Surge In Risk Assets

In his latest blog post “Shikata Ga Nai” the BitMEX exchange CEO explores the relationship between the US and Japan’s economies and how it can impact the crypto market.

Hayes described how “deadbeat Japanese banks have fallen victim to the monetary policies of Pax Americana.” According to him, Japanese banks engaged in a dollar-yen carry trade via the US Treasury (UST) to earn significant yields on their yen deposits, as yields on all “safe” government and corporate bonds were nearly zero.

However, Hayes explained that the COVID pandemic led to rising inflation, forcing the United States Federal Reserve to increase interest rates at the fastest pace since the 1980s. The rising rates were devastating for anyone holding USTs. Hayes noted:

From 2021 to 2023, the rising yields produced the worst bond rout since the War of 1812. Shikata Ga Nai!

While the US bailed out leading American banking institutions with significant balance sheet holes, Japanese banks holding USTs were at risk. Hayes highlighted that Norinchukin (Nochu), the 5th largest Japanese bank by deposits, “will dump $63 billion worth of foreign bonds, the majority of which are USTs.”

Hayes believes that all Japanese banks engaged in similar UST trades will start selling their bonds. According to the International Monetary Fund, these banks held around $850 billion in foreign bonds going into 2022.

To sum up, Hayes argues that Japanese banks selling USTs “will force the Federal Reserve to turn on the printing press, which will drive growth in risk assets.” He compared the situation to September to October 2023, when the UST yield curve steepened, causing 10-year and 30-year USTs to trade at yields above 5%, while the S&P 500 dropped 20%. However, during the same period, Bitcoin and other cryptocurrencies rallied starting in November 2023, and continuing until March, driven by the SEC’s approval of spot Bitcoin exchange-traded funds (ETFs).