in a interview Recently on Crypto Banter, BitMEX co-founder and former CEO Arthur Hayes warned of an imminent sharp correction in cryptocurrency prices, but added that there could be a sustained bull run after that. According to Hayes, Bitcoin and other risk-on assets are expected to see a deep correction in the near future as a large amount of liquidity exits the market.
Arthur Hayes – Co-Founder and Former CEO of BitMEX
Hayes highlighted that the U.S. debt ceiling is expected to be raised this year and the issuance of $1.1 to $1.2 trillion in national debt to fund the U.S. federal deficit through 2023, around which figures are estimated by the Congressional Budget Office. While the US Treasury is selling bonds, the Federal Reserve (Fed) is still committed to reducing US Treasuries by $100 billion a month, posing a threat to risky assets as it greatly drains liquidity in the market.
The flood of U.S. Treasuries into the market, coupled with mixed messages from the Federal Reserve, has created an uncertain and cautious environment for investors. Therefore, Hayes advises his readers to keep an eye on the market and be ready to act quickly. He also suggested monitoring the Treasury General Account (TGA) as it would signal when the government is depleting its cash balance and is about to hit the debt ceiling.
Hayes believes that Bitcoin has not really escaped its correlation with global risk assets and will be ready for the era of “coefficient 1 correlation”, which means that “everything is massively aggregated in price, even Bitcoin.” While Hayes acknowledged the possibility of the cryptocurrency king breaching the $20,000 mark, he sees the possibility of further declines. However, he remains optimistic about the long-term potential, especially given the response of financial and monetary authorities in difficult economic times.
According to Hayes, if another recession occurs, the government will pump money into the economy and print more money, which could further increase the value of Bitcoin. After that, Bitcoin and Ethereum will maintain their upward momentum, and then other altcoins will rise vertically.
The cryptocurrency industry is known for its volatility, which can result in huge gains and losses for investors. To navigate this unpredictable situation, Hayes emphasized the importance of understanding cyclicality. These assets tend to follow a “wave” pattern, with BTC and ETH leading the way before stalling and giving way to altcoin rallies. Finally, these lesser-known cryptocurrencies also corrected and the cycle started again with renewed interest in BTC, ETH.
While the market has grown significantly in recent years, Hayes’ warning is a reminder to be cautious when investing. Given the current volatile situation, it’s important for investors to keep an eye on the market and be prepared to act quickly.
Arthur Hayes big transfer, where did the money go?
according to Report One of PeckShield’s links to Arthur Hayes’ address connected 137 ETH from Arbitrum and exchanged them for 223,000 USDT, or roughly $1,632 per ETH. Then the same address transferred 311,000 USDT to Binance yesterday morning.
Hayes’ move comes after he sold BLUR, which he recently tweeted about. While it’s unclear why Hayes did this, the removal of funds from the Arbitrum network could be seen as a sign of all layer 2 investors.
source: pecking shield alert
The total value locked (TVL) in the Arbitrum network has increased recently, suggesting that Hayes’ move has nothing to do with overall layer 2 performance. However, his move of such a large amount of funds out of the network still exists. May cause some apprehension.
Notably, Arbitrum Network has gained traction in recent months as many investors look for layer 2 alternatives to Ethereum’s high gas fees. Arbitrum aims to enable fast and low-cost transactions on the Ethereum network, making it an attractive option for those looking to avoid high transaction fees.
While it’s unclear what Hayes’ intentions are with these moves, it’s clear that he remains a prominent figure in the crypto space. Hayes resigned as BitMEX CEO in 2020 after being accused of violating U.S. anti-money laundering regulations.
Hayes’ departure from Arbitrum could be a signal for all Tier 2 investors to reevaluate their positions. It’s unclear what his intentions were, but it suggests the former BitMEX CEO recognized a potential risk or opportunity in the market.
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Mingying
According to Kyptos
