Arthur Hayes, former CEO of bitcoin and cryptocurrency exchange BitMEX, now believes that a “disastrous global financial meltdown” will crash the price of bitcoin and the cryptocurrency market. It warns that there is a possibility that
Brutal bear markets need up-to-date information the most! Sign up for free now crypto codex—Stay ahead of the market with our daily newsletter for traders, investors and anyone interested in cryptocurrencies
“Bitcoin is only experiencing a natural bounce from local lows below $16,000,” Hayes wrote. blog posthe added, “I believe bitcoin is on the rise as the market is leading the way in resuming printing of the Federal Reserve.”
Crypto market analyst Noel Acheson wrote in an email: “Market expectations for a moratorium on rate hikes and a Fed pivot are rising, despite the Fed’s repeated public comments to the contrary. It is.” Note.
Fed Chairman Jerome Powell, who last year raised interest rates to a 15-year high as part of a concerted effort to curb inflation, said interest rates must be raised in 2023 and supports raising benchmarks. Other Fed officials who have done so agree. The federal fund rate is over his 5%.
“If the Fed does not execute a pivot, or if multiple Fed governors deny pivot expectations even after a ‘good’ CPI is printed, Bitcoin will crash towards previous lows. “It’s likely,” Hayes wrote. Projecting this scenario “would create a risky asset price crater. Bonds, stocks, and all cryptos under the sun would all fall to the global U.S. dollar.” Smoke rises as the glue that holds the underlying financial system together dissolves.”
If that “disastrous global financial meltdown” scenario were to occur, Mr. Hayes would “have another bite” and “know that the market has probably bottomed out, which happens when systems temporarily break down.” The crash will be to the previous $15,800 low, or not.”
SIGN UP NOW crypto codex— Free daily newsletter for those interested in cryptocurrencies
Bitcoin’s price fell below $16,000 following last year’s shocking FTX collapse, putting pressure on a compound crypto market that had already lost around $2 trillion.
But despite warnings of a looming market meltdown, Hayes expects the Fed to eventually step in to protect markets.
“It doesn’t matter what level the downdraft ends up at, because I know the Fed will then print money and move to avoid another financial collapse,” Hayes said. be.