Arthur Hayes, founder of BitMEX, one of the largest cryptocurrency brokers in the world and an influential figure in the industry, revealed his predictions for Bitcoin, anticipating a price drop in the coming months.
In his most recent blog post, Hayes warned cryptocurrency investors about a possible significant correction in the price of Bitcoin, which is expected to occur in March this year.
He claims he’s preparing “to a brutal defeat of all crypto tourists”revealing plans to sell some of its cryptocurrency holdings.
Hayes identified three key factors that, according to his analysis, came together in March and could cause a price correction of up to 30% in Bitcoin.
Bitcoin could fall 30% by March
One of the elements highlighted by Hayes is the balance of the reverse repurchase program (RRP). Hayes suggests that a decline in the RRP balance could lead to a reduction in market liquidity and consequently a negative impact on prices.
He also points to the importance of the renewal of the Bank Term Financing Program (BTFP), scheduled for March 12, as a critical factor for banks seeking liquidity to exchange for US government bonds. Failure to renew this program, especially in an election year, could be a destabilizing factor.
The third point that Hayes mentions concerns the monetary policy of the US Central Bank (Fed) with regard to interest rates. With the Fed having raised rates since March 2022, Hayes will explore the possibility of a rate cut at the March 20 meeting, which could impact future liquidity expectations for the dollar.
Bitcoin will fall after ETF approval
While Bitcoin rebounded notably in December and continued its upward trajectory through 2024 and is currently trading above $43,500, Hayes predicts the cryptocurrency will undergo a correction after the January and February highs.
He speculates that the listing of the first Bitcoin ETFs in the US could amplify this correction, suggesting that “a healthy correction of 20% to 30%” is expected in relation to the price levels reached in early March.
Hayes also considers a scenario where, if Bitcoin were to reach prices close to its all-time high of $70,000, driven by the expected flow of fiat money into Bitcoin ETFs, there could be a 30% to 40% correction due to the reduction in the rates. liquidity.
Despite this downside forecast, Hayes maintains a positive outlook for the cryptocurrency market beyond March. He speculates that Bitcoin could rise ahead of the Fed meeting in anticipation of a rate cut, highlighting Bitcoin as “the only strong, neutral reserve currency that is not a responsibility of the banking system and is traded globally.”
He expects a resumption of the uptrend after the brief market turmoil, especially amid speculation about the impact of the upcoming halving.
Finally, Hayes, known for his market analysis and optimistic predictions, including his previous prediction that Bitcoin could reach the $1 million mark, revealed that he plans to sell at peak prices in February and resume purchases when the price of Bitcoin decreases in March.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
