The U.S. government may be one of the largest holders of Bitcoin

The U.S. government may be one of the largest holders of Bitcoin, but according to BitMEX co-founder Arthur Hayes, that’s unlikely to change anytime soon. In a recent interview on May 1, Hayes said the chances of the U.S. significantly increasing its Bitcoin reserves are slim, considering national debt concerns and the cultural image tied to Bitcoin investors.

Discussing President Trump’s executive order to explore a U.S. strategic Bitcoin reserve, Hayes argued that while the country technically holds nearly 200,000 BTC, mostly seized through high-profile criminal cases involving Silk Road and Bitfinex, it’s politically and economically impractical for the country to actively purchase more Bitcoin.

“The United States is a deficit country. The only way they can do a strategic reserve is by not selling the Bitcoin they took from people. Fine, that’s 200,000 Bitcoin. But they’re not going to expand it,” Hayes stated.

He added that expanding those reserves through direct purchases would be nearly impossible for any elected official to justify, especially in an era of rising fiscal scrutiny. According to Hayes, the public perception of Bitcoin, often associated with speculative trading and crypto party culture, makes it political suicide.

“Try explaining to voters why you’re printing more money to buy Bitcoin, especially when the popular narrative is a bunch of BTC bros going to the club. Is that really what you want people to think about your policy?”

Arthur Hayes Predicts Bitcoin Surge and Altcoin Rally

However, despite this bleak outlook, Hayes' comments come on the heels of a surprising development. Former President Donald Trump signed an executive order aimed at exploring the creation of a U.S. strategic Bitcoin reserve. While some in the crypto community viewed it as a signal of long-term government support, others, including Hayes, dismissed it as more symbolic than actionable.

Yet, despite Hayes' skepticism, the announcement has fueled debate about whether the U.S. will eventually join other nations in actively acquiring BTC as a hedge against inflation and economic instability.

Turning to the broader crypto market, Hayes expressed confidence in the resurgence of Bitcoin dominance. He believes the market is heading back to pre-2021 dynamics, with BTC reclaiming its position as the market leader before altcoins begin their rally.

“It’s back at all-time highs; bull markets are back, and altcoins should outperform. Should is the keyword depends on what you buy.”

Bitcoin dominance currently sits at 64.78%, up from under 60% at the start of 2025.

Hayes expects a return of 70%, though not all analysts agree. Benjamin Cowen argues that BTC is unlikely to regain that level of dominance, while CryptoQuant CEO Ki Young Ju believes traditional indicators of altcoin season are meaningless. He points instead to stablecoin and fiat inflow data as more accurate indicators in today's market.

According to Ju, the significant inflow into stablecoin and fiat exchanges suggests a preference for altcoins over Bitcoin. This aligns with the observation that the market usually moves in cycles, pivoting from one asset class to another.

"The surge in altcoin trading volume isn't driven by $BTC pairs but by stablecoin and fiat pairs, reflecting real market growth rather than asset rotation.

Stablecoin liquidity better explains the altcoin markets," Ju noted.

MicroStrategy Expands Bitcoin Buying

While the U.S. government remains hesitant, the private sector is forging ahead. Michael Saylor’s firm, MicroStrategy, has dramatically expanded its capital-raising plans to purchase more BTC.

The Virginia-based company revealed it is nearly quadrupling its equity raise to $84 billion, filing to sell an additional $21 billion in shares after already exhausting its previous allocation. It also increased its debt issuance target from $21 billion to $42 billion, leaving just under $15 billion in unused capacity.

This aggressive strategy reflects a broader trend among public companies. In Q1 2025 alone, institutional BTC holdings grew by 16.1%, highlighting a sustained appetite for digital assets despite ongoing market volatility.