Following our previous reports, it is known that Bitcoin has been having a wild ride lately in the “cryptoverse”. After hitting an all time high of $110K, the top cryptocurrency has corrected hard. Now, amidst market volatility and shifting sentiment, former BitMEX CEO, Arthur Hayes is making a bold call: he thinks Bitcoin will bottom at $70K before the next up.
- Hayes’ Bold Forecast: What’s Next for Bitcoin
- Economic Catalysts: Central Banks and Financial Markets
- Volatility Navigation: Strategic Timing for Investors
- Short-Term Volatility: Bitcoin’s Road to Calm
- Bitcoin vs Stocks: A Free Market Perspective
- The Long Term Bullish View: Beyond the $70K Bottom
- Conclusion: Be Patient
- Glossary
In a post on X (formerly Twitter) on March 11, Arthur Hayes told market participants to be patient during this messy period. His blunt message: “The plan: Be fucking patient”; resonates with many who see short term pain as a necessary precursor to long term gains.
Hayes’ Bold Forecast: What’s Next for Bitcoin
Arthur Hayes is no stranger to making controversial yet insightful calls. With his reputation built at BitMEX, his opinions matter in the crypto space. According to his latest comments, Bitcoin is experiencing a 36% correction from its previous high, which he thinks is totally normal in a bull market.
Hayes said,
“BTC likely bottoms around $70K. 36% correction from $110K ATH, v normal for a bull market.”
It’s not just a guess, it’s based on his understanding of market cycles and price history. Hayes points out that corrections are common and deep pullbacks often set the stage for the next big move. For investors, this means the current volatility is less of a problem and more of an opportunity.
Economic Catalysts: Central Banks and Financial Markets
Arthur Hayes’ forecast is tied to his broader economic assessment. He says that for Bitcoin to rally strongly from the $70K bottom, there needs to be a big downturn in the financial markets. He thinks a sharp decline in indices like the S&P 500 (SPX) and Nasdaq (NDX) will cause financial institutions to blow up and for central banks to launch quantitative easing.
Key central banks mentioned include:
– The Federal Reserve (Fed)
– The People’s Bank of China (PBOC)
– The European Central Bank (ECB)
– The Bank of Japan (BOJ)
He says that would create an environment of more liquidity. When fiat liquidity increases, investors flee to hard assets like Bitcoin and demand goes up. This has happened in previous cycles where easing has led to big rallies in risk assets.
Volatility Navigation: Strategic Timing for Investors
Beyond the bottom, Arthur Hayes offers practical advice on how to navigate the crypto market volatility. He says be strategic. His advice is two fold:
- For Aggressive Investors: Those willing to take on more risk can try to “buy the dip” as prices drop. But Hayes warns that timing the exact bottom is hard.
- For the More Risk Averse: Hayes recommends waiting for central banks to signal monetary easing.
“If you are more risk averse, wait for the central banks to ease then deploy more capital. You may not catch the bottom but you also won’t have to mentally suffer through a long period of sideways and potential unrealised losses.”
This is about finding a balance between taking advantage of the dip and not suffering through uncertainty.
Short-Term Volatility: Bitcoin’s Road to Calm
Arthur Hayes is optimistic long term but warns of short term volatility. He says Bitcoin may retest $78K and even $75K if it can’t hold support. A big factor is the concentration of options between $70K and $75K which will amplify price swings.
The fact that so many options are concentrated between $70K and $75K means many traders are hedging their positions and anticipate further movement in this zone. This will cause more volatility in the short term as people adjust their positions based on the technicals.
Bitcoin vs Stocks: A Free Market Perspective
In his analysis Hayes says:
“BTC is a true free market, stonks are not. Therefore in a fiat liquidity crisis BTC leads stocks on down and up.”
This is saying that BTC is a free market and stocks are not. In a fiat liquidity crisis BTC will go down and up faster than stocks.
This highlights the difference in market dynamics. Stocks are often influenced by government intervention and regulatory frameworks. BTC is a largely decentralized market. In a liquidity crisis BTC will correct and recover faster than stocks.
It also points to the psychology of the investor. In a situation where stocks are uncertain BTC’s decentralization and supply will make it a hedge against inflation and currency devaluation.
The Long Term Bullish View: Beyond the $70K Bottom
Arthur Hayes’ bullish view goes beyond the upcoming correction. He predicted in November last year that BTC could go to $1 million. His argument was that expansive credit policies (like Trump’s) drive inflation and investors will move to hard assets like BTC.
Though he’s long term view may seem crazy it’s based on historical trends. BTC’s price has been influenced by its halving cycles and the macro environment. If this correction bottoms at $70K then it could be a great setup for a big recovery with renewed investor confidence and monetary policy support.
The market is responding to BTC’s dip differently. Short term traders are spooked by the volatility, long term investors see this as a buying opportunity. Some market observations:
– Accumulation: Large holders, or “whales,” are buying during these dips.
– Exchanges drying up: On-exchange liquidity is decreasing, investors are moving to cold storage, they believe in long term gains.
– Mixed Sentiment: Traditional markets are struggling with economic uncertainty, crypto community is divided—some see a clear path to recovery, others expect further declines.
This divergence is key to understanding the potential for a rally. If traditional markets stabilize or decline enough to force central bank intervention, the resulting liquidity will flow into Bitcoin.
Conclusion: Be Patient
Arthur Hayes thinks Bitcoin will bottom at $70K. His analysis is based on historical precedent and macro trends. The volatility is necessary for a strong bull run. Shorts are concentrated at critical levels and derivatives are getting smashed. The fundamentals: expansive liquidity, market cycles, Bitcoin’s free market nature; remain intact.
Investors should be patient, watch supports and resistances and wait for central bank interventions to increase liquidity. As Hayes says, sometimes the best move is to just be patient and let the market do its thing.
Stay updated with Deythere as we’re available around the clock, providing you with updated information about the state of the crypto world.
FAQs
1. Why does Arthur Hayes think Bitcoin will bottom at $70K?
Arthur Hayes believes a 36% correction from all time high is normal for bull markets. He expects price to stabilize and rebound as broader financial conditions force central banks to ease.
2. What are the key levels to watch for Bitcoin?
Support is between $75K and $76K, resistance is between $82K to $85K. A sustained break above resistance could be the start of the bull run.
3. How do central banks fit into Hayes’s prediction?
Arthur Hayes says if S&P and Nasdaq decline sharply, it will put financial institutions under stress. In response, central banks (Fed, PBOC, ECB, BOJ) will ease and increase liquidity and demand for Bitcoin.
4. What investment strategy during volatile times?
Arthur Hayes says to be patient and time your investments. Risk averse investors should wait for central bank easing signals to deploy capital, aggressive investors can buy the dip with caution.
5. How does Bitcoin’s free market nature differ from stocks?
Unlike stocks which are regulated by frameworks and government intervention, Bitcoin is a decentralized free market. This makes it more prone to corrections but also more conducive to rebounds.
Glossary
Bitcoin Bottom: The lowest price Bitcoin will go before it rebounds.
Monetary Easing: Central bank policies to increase liquidity, often through lower rates or QE.
Market Correction: A drop in prices from recent highs, considered a normal re-adjustment in an overbought market. In crypto, corrections can be steep and are part of the cycle.
Central Bank: The main bank of a country responsible for the currency, money supply and interest rates, and monetary policy (e.g. Federal Reserve, ECB).
Fiat Currency: Government issued currency not backed by a physical commodity (e.g. USD, EUR) that is the basis for modern financial systems.
Risk-Off Sentiment: A market where investors become more risk averse and move capital from volatile assets to safe havens, usually in response to economic uncertainty.
Asset Rotation: The process of investors moving capital from one asset class to another, usually due to changes in market conditions or risk appetite. In crypto this means moving funds between Bitcoin, altcoins and stablecoins.
References
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