With the Bank of Japan (BOJ) already backpedaling its world-shaking rate hike last week, BitMEX co-founder Arthur Hayes says it is time to ‘buy the fucking dip.’

“Just so I'm clear. BTFD! Because the BOJ caved,” Hayes tweeted on Wednesday.

The day prior, BOJ Deputy Governor Shinichi Uchida told business leaders that the central bank would avoid raising interest rates amid financial market instability.

The central banker’s words immediately injected confidence back into the Japanese stock market, with the NIKKEI recovering all of its losses from early Monday. The USD:JPY ratio is also back above 146, and the price of Bitcoin is back to $56,000 – up from its $49,750 low earlier this week.

Hours earlier, Hayes published another macroeconomic analysis essay titled “Spirited Away”—outlining why the BOJ’s actions have decimated equities worldwide, and predicting how the world will likely respond.

Specifically, raising interest rates above 0% collapsed the yen “carry trade,” whereby institutions borrowed yen extremely cheaply to buy USD-denominated assets that appreciated faster than their interest payments. With borrowing costs just slightly higher, “everyone rushes to cover simultaneously as the yen strengthens because they are highly leveraged,” Hayes explained.

He argued that the United States will be forced to inject liquidity if higher yen borrowing costs continue to ravage global markets. That’s especially true with election season around the corner, and Kamala Harris wishing to keep her voters happy.

“The question is when the Fed and Treasury will print money to blunt its effects on Pax Americana,” Hayes wrote.

At that time, Hayes said Bitcoin could either be trading in “convex” or “correlated” fashion. Convex would mean that Bitcoin pumps when the Japanese Yen either aggressively strengthens or aggressively weakens—the former implying that the market expects a bailout that will pump Bitcoin very soon.

“Correlated” would mean that Bitcoin falls as the yen strengthens and rises as it weakens, meaning it simply trades alongside stocks.

“If the setup is convex-Bitcoin, I will aggressively add positions as we have reached the local bottom,” Hayes said. “If the setup is correlated-Bitcoin, then I will sit on the sidelines and wait for the eventual market capitulation.”

Given the BOJ’s latest decision, and Bitcoin’s following reaction, the BOJ will likely not strengthen the yen any further, he suggested. That would mean Bitcoin appreciates in either scenario.

“When the BOJ says they will not raise rates if the market is too volatile they are telling you, they are happy with yen 140-160 range,” said Hayes. “Therefore you change up.”