Bitcoin and other top ten cryptocurrencies such as ethereum, XRP, and solana have experienced a sharp decline, despite a massive $10 trillion bitcoin price bet. This has resulted in a nearly 10% drop in bitcoin price over the last 24 hours, affecting the price of other major cryptocurrencies and erasing around $100 billion from the combined crypto market following its bitcoin spot exchange-traded fund (ETF) surge.
Prior to the bitcoin price crash, renowned bitcoin and crypto trader Arthur Hayes had cautioned that the Federal Reserve might trigger a 30% bitcoin price crash, forecasting “a vicious washout” in the upcoming months. Hayes, the chief investment officer of family office Maelstrom and the former CEO of the bitcoin derivatives pioneer exchange BitMex, has been preparing for a significant washout of all the crypto tourists in March of this year.
Hayes loaded up on crypto in the second half of 2023, and he believes that the period from now until April is a no-trade zone in terms of risk addition. He predicts that the bitcoin price could crash between 20% to 30% due to “a dollar liquidity rug pull.” However, he also expects the bitcoin price to rebound quickly as the Federal Reserve restarts its money printer.
Hayes explains that bitcoin will initially decline sharply with the broader financial markets but will rebound before the Fed meeting. This is because bitcoin is the only neutral reserve hard currency that is not a liability of the banking system and is traded globally.
The 2022 bitcoin price crash, which wiped $2 trillion from the bitcoin, ethereum, XRP, solana, and crypto market, was largely attributed to the Federal Reserve increasing interest rates and reducing its balance sheet in response to skyrocketing inflation that threatened to spiral out of control.
However, the bitcoin price rebounded sharply in 2023, gaining momentum as the BlackRock-led Wall Street bid to bring a spot bitcoin ETF to market approached its culmination this week, with the U.S. Securities and Exchange Commission (SEC) approving a series of funds.
CK Zheng, chief investment officer at crypto hedge fund ZX Squared Capital, believes that the approval of spot bitcoin ETFs is still a ‘sell the news’ event, but it will be very shallow in the near term. He suggests that any significant pullbacks in the bitcoin price in the short term will present a great opportunity to add significantly more long positions.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | North America |
| Countries | 🇺🇸 |
| Sentiment | negative |
| Relevance Score | 1 |
| People | CK Zheng, Arthur Hayes |
| Companies | BitMex, U.S. Securities and Exchange Commission, Federal Reserve, ZX Squared Capital, BlackRock, Maelstrom, Forbes |
| Currencies | Bitcoin, Solana, US Dollar, Ethereum, XRP |
| Securities | None |
