In the medium term, halving is a bullish catalyst for the crypto market. But immediately before and after the event, prices may fall, says ex-CEO of BitMEX Arthur Hayes.
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“Heatwave” is an essay on why I’m bearish despite the recent move higher in #crypto markets. pic.twitter.com/fH6docB499
— Arthur Hayes (@CryptoHayes) April 9, 2024
“The narrative that halving block rewards will have a positive effect on cryptocurrency prices is firmly entrenched. When the majority of market participants agree to a certain outcome, the opposite usually happens,” the expert said.
He noted that in the second half of April the market will face a reduction in dollar liquidity. The reasons will be the tax season, the Fed’s quantitative tightening (QT) policy and the strengthening of the Treasury’s balance sheet.
This factor will be an additional incentive for “a furious sell-off in cryptocurrencies,” Hayes believes.
“Will the market be able to challenge my bearish tendencies and continue to rise? Hell yes. I’ve been involved in cryptocurrency for a long time, so I welcome being wrong,” he admitted.
According to the expert, after May 1, the Fed will reduce the QT rate, and the Ministry of Finance will release “most likely an additional $1 trillion of liquidity into the system, which will pump up the markets.”
Hayes added that the “bag of tricks” from regulators only strengthened his decision to refrain from trading Bitcoin until the above date.
“If I miss out on a few percentage points of profit but definitely avoid a loss on my portfolio and lifestyle, that’s an acceptable outcome,” the trader said.
He reported that he “took full profit” on positions in MEW, SOL and NMT, which he invested in USDe from Ethena for staking.
Let us recall that the DeFi project implemented Hayes’ ideas in the mechanism of its “synthetic dollar”.
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2024-04-09 07:37:05
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