Arthur Hayes – the co-founder of BitMEX, one of the biggest digital currency exchanges in the world – is worried the price of bitcoin could drop to $30,000 by June.
Arthur Hayes Thinks Bitcoin Is Going Down Heavily
Bitcoin – and several other forms of crypto – have been on a downward spiral in recent days. The world’s number one digital currency by market cap recently encountered something of a short bull run, in which the asset gained about $8,000 to hit $48,000 in just a matter of days following several weeks of remaining at around $40,000. However, since then, the currency has been “failing at the crypto box office” so to speak and is now hovering between $39,000 and $41,000.
This is a major change from where bitcoin was just five months ago. In November of last year, the world’s biggest digital asset reached a new all-time high of about $68,000 per unit. Everyone was convinced the crypto space had reached its peak, and that bitcoin was virtually unstoppable. The sentiment was that the asset was going to rise and rise until it could rise no more. Sadly, this wasn’t to be, and the asset has been teetering ever since.
Hayes doesn’t think bitcoin is a weak asset. He has built his whole career on bitcoin, but he has noticed heavy correlation between the digital currency and the Nasdaq – particularly tech stocks, which at the time of writing, are heavily vulnerable to rising Fed rates.
The Fed has been implementing higher interest rates over the past few weeks given that they can no longer afford to dole out COVID relief measures. The country is not positioned to take on additional debts, and with people like Joe Biden contributing to heavy inflation and other economic uncertainties, many are now confident a recession may be on its way. Is this 2008 all over again? No one knows for sure yet.
Until we do, however, Hayes and other analysts feel that bitcoin and several additional assets are going to continue to experience fluctuations like never before. He commented in an interview:
For me to hoist the flag in support of selling fiat and buying crypto in advance of an NDX meltdown (30 percent to 50 percent drawdown), correlations across all timeframes need to trend demonstratively lower. So long as the ten-day correlation stays high, we must stay defensive on our crypto positioning.
This All Stem’s from the Fed’s Recent Decisions
Discussing the Fed’s later plans, he further stated:
[The] Fed isn’t planning to grow its balance sheet again any time soon, meaning equities aren’t going any higher. There isn’t much science to these numbers other than a gut feeling.
Last February, Arthur Hayes – along with his BitMEX co-founder – were made to pay fines of $10 million each after pleading guilty to federal charges of failing to implement appropriate anti-money laundering protocols.