In a recent blog post, Arthur Hayes, the former CEO and co-founder of BitMEX, shared his insights on the current state of Bitcoin and his predictions for its future. He suggests that Bitcoin might fall 30% from its recent high of $48,000 following the approval of the Spot Bitcoin ETF. According to Hayes, this could lead to Bitcoin dropping to as low as $33,600, with potential support forming between $30,000 and $35,000.
Hayes’ Investment Moves: Preparing for the Dip
Anticipating the potential downturn, Hayes has revealed that he purchased strike puts for Bitcoin at $35,000. He outlined a scenario in which, if the Bank Term Funding Program (BTFP) is not renewed, he will double down on his crypto investments. However, if the BTFP is extended, Hayes plans to close his put options and increase his crypto risk by selling treasury bills and acquiring more crypto assets.
Altcoin Choices: Solana and WIF
If Bitcoin might fall 30%, Hayes plans to engage in “bottom fishing” and invest in altcoins. Specifically, he mentioned loading up on Solana and WIF (presumably WiF or Wrapped Bitcoin). Hayes sees potential in these altcoins and believes they could present lucrative opportunities during the expected market dip. Notably, he dismisses BONK as “last cycle’s doggy money,” favouring Solana’s second-largest meme coin. Hayes asserts, “If it ain’t Wif Hat, it ain’t shit.”
BTFP’s Role in Bitcoin’s Recent Decline
Hayes attributes Bitcoin’s recent decline to the potential non-renewal of the BTFP. According to Hayes, the possibility that Bitcoin might fall 30% is attributed to the likely non-renewal of the Bank Term Funding Program (BTFP). He suggests that Bitcoin is already factoring in the absence of this funding, anticipating potential catastrophic consequences. Hayes emphasizes the program’s significance for banks, suggesting their dependence on government support. Hayes speculates that this scenario might force the Federal Reserve to take actions such as a rate cut, tapering of Quantitative Tightening, and a resumption of money printing through Quantitative Easing (QE). He suggests that Bitcoin’s recent price action aligns with this prediction.
Grayscale’s GBTC Outflows Dismissed
While some have pointed to Grayscale’s GBTC outflows as a cause for Bitcoin’s decline, Hayes dismisses this argument. He notes that the outflows from GBTC are outweighed by inflows into newly listed Spot Bitcoin ETFs, dismissing the notion that Grayscale’s actions are significantly impacting the market.
Hayes dismisses arguments about Grayscale’s GBTC outflows causing Bitcoin’s decline, highlighting that net inflows into newly listed Spot Bitcoin ETFs exceed outflows from GBTC. He argues that Bitcoin’s price action serves as a cautionary sign, reflecting concerns about the potential impact of the BTFP non-renewal on the broader financial market.
Navigating the Crypto Market Amid Uncertainties
As Bitcoin faces potential volatility, it might fall 30%; Arthur Hayes is positioning himself strategically, ready to capitalize on market movements. His insights and investment choices shed light on the complexities and uncertainties within the crypto space, providing valuable perspectives for investors navigating this dynamic market. Hayes’ insights and strategic moves provide a unique perspective on the challenges and opportunities within the crypto market. Investors are keenly watching as Bitcoin navigates uncertain waters, with the top two altcoins, Solana and WIF, on the radar for potential investment opportunities.
Expressing his belief that the Fed prefers verbal communication over direct actions due to inflation fears, Hayes predicts a dip in Bitcoin before the BTFP renewal decision on March 12th. He suggests Bitcoin may find a local bottom between $30,000 and $35,000, rising in the face of a potential mini-financial crisis in March.
Also Read: Google Set to Allow Bitcoin ETF Ads on Search Engines.
