Prominent crypto trader Arthur Hayes is sounding a cautionary note as Bitcoin’s price experiences a decline just two weeks after the launch of the Bitcoin exchange-traded fund (ETF).
Hayes draws attention to the correlation between Bitcoin’s recent peak and the two-year US treasury hitting a local low of 4.14% this month, suggesting a potential connection between the two events.
Debunking the GBTC Outflow Argument
In a recent blog post, Hayes dismisses the common argument attributing Bitcoin’s price slump to outflows from the Grayscale Bitcoin Trust (GBTC). He argues that when considering both GBTC outflows and inflows into newly listed spot Bitcoin ETFs, there is a net inflow of $820 million as of January 22nd.
Despite over $3.3 billion in outflows from Grayscale since spot Bitcoin ETF approvals, Hayes points to concerns about the Bank Term Funding Program (BTFP) not getting renewed as a potential explanation for investor sentiment.
BTFP Renewal and Price Expectations
The US government’s decision on BTFP renewal, scheduled for March 12, becomes a focal point for Hayes. He anticipates Bitcoin’s price to continue decreasing until the renewal decision is disclosed, projecting a support range between $30,000 to $35,000.
Expressing confidence in his analysis, Hayes shares his strategy by purchasing options: “I purchased 29 March 2024 $35,000 strike puts.” He foresees a reversal in the trend after the BTFP renewal decision, expecting a rise in Bitcoin’s price post-announcement.
Arthur Hayes’ Bullish Prediction
Looking beyond the short-term fluctuations, Arthur Hayes remains optimistic about Bitcoin’s future. He previously predicted a price target of $70,000 by the end of 2024, citing factors such as decreasing interest rates, the crypto halving event, and the launch of spot Bitcoin ETFs. Hayes even extends his bullish outlook to 2026, envisioning Bitcoin reaching a range from $750,000 to $1 million.
