Prediction by Arthur Hayes: Bitcoin Price Set to Fall Below 40,000 Dollars

Crypto News- Arthur Hayes, co-founder of the renowned BitMEX cryptocurrency exchange, recently expressed a rather pessimistic perspective on the fate of Bitcoin, foreseeing a descent below the ominous $40,000 mark.

Taking a bold stance on his newfound outlook, Hayes revealed his strategic move to invest in put options with a strike price of $35,000, maturing on March 29. This decision was unveiled in the midst of a discourse on X, where Hayes attributed his altered viewpoint to the impending US Treasury quarterly refunding announcement.

Prediction by Arthur Hayes: Bitcoin Price Set to Fall Below 40,000 Dollars

Intriguingly, the reports indicate that Hayes might have delved into put options at a rate of 0.025 BTC per share, accumulating a total of 5 BTC and pegging the overall investment at approximately $203,620. This strategic move underscores his confidence in the short-term trajectory of Bitcoin, as put options represent a significant speculative position in the notoriously volatile crypto market.

Furthermore, Hayes projects a sustained decline in Bitcoin’s value, echoing his forecast until the US Treasury quarterly refunding announcement scheduled for January 31.

Contrastingly, in a surprising turn of events, Hayes had offered a more optimistic outlook on January 16, envisioning a substantial surge in the total market capitalization of Bitcoin (BTC) and other digital assets, exceeding a staggering $1.3 trillion within the current year.

As a veteran presence in the crypto realm, Hayes foresaw that by 2024, the cumulative market capitalization of all digital assets could not only meet but surpass the previous all-time high set in 2021.

BitMEX Co-Founder Takes a Position in Put Options

This anticipated upswing was tethered to the month of March, coinciding with potential actions by the Federal Reserve to infuse more liquidity into the market. Historical data suggested that such maneuvers by the Fed typically triggered rallies in risk assets, including the ever-volatile Bitcoin.

Hayes speculated that the Federal Reserve might declare rate cuts in March and revive the Bank Term Fund Program (BTFP). Originating last year amid the peak of the banking crisis, the BTFP was crafted to offer liquidity to beleaguered banks grappling with withdrawal demands.

Following Hayes’s declarations, Bitcoin’s market witnessed a downturn, plummeting to $40,500, currently lingering below $41,000. This reflects a 2.6% decline within the last day and a more substantial 4.5% dip over the past week.