Bitcoin Bounces Back, but Arthur Hayes Predicts a Correction
After the recent flash crash and concerns over a potential ETF rejection, Bitcoin has managed to recover. However, BitMEX founder Arthur Hayes has a cautious outlook on the future of the asset. Hayes predicts a possible correction of 20% to 30% in March, which could result in a “vicious washout of all the crypto tourists.”
Potential Correction Could be Even Greater
In his recent blog post, Hayes suggests that if US-listed spot Bitcoin ETFs are launched as expected, the correction could be even more significant. He speculates that the influx of fiat into these products could drive BTC prices above $60,000, nearing the all-time high of $70,000. He even contemplates a larger correction of 30% to 40%, which he attributes to a potential “dollar liquidity rug pull.”
Hayes’ Trading Strategy
Hayes reveals that he has decided not to buy Bitcoin until after the March decision dates have passed. He plans to top-tick the market in late February and purchase put options with a June 28th expiry. He strategically avoids the March 29th expiry due to concerns about negative theta overwhelming other factors.
Bull Market Continues, but Be Cautious
While Hayes expects some market turmoil in the short term, he believes that the current crypto bull market is still in its early stages. He advises investors not to get carried away with their enthusiasm. By the end of March, he anticipates the market regaining its footing and continues to have faith in Bitcoin’s upward trajectory.
Hot Take: Hayes Warns of Potential Correction and Advises Caution
Arthur Hayes, the founder of BitMEX, predicts a potential correction of 20% to 30% for Bitcoin in March. He cautions that if US-listed spot Bitcoin ETFs are launched, the correction could be even greater. Despite this, Hayes remains optimistic about the market’s long-term outlook. He advises investors to be cautious and not get carried away with their enthusiasm. While there may be some short-term turbulence, Hayes believes that the current crypto bull market is still in its early stages and expects the market to regain its footing by the end of March.
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