Arthur Hayes, the founder of BitMEX, has issued a warning to the crypto market, suggesting that the upcoming Bitcoin halving could lead to a temporary slump in prices. Contrary to popular opinion, Hayes believes that the macro setup is favorable for traders interested in shorting the market.
In a recent analysis, Hayes explained that while the Bitcoin block reward halving on April 20th is typically seen as a bullish catalyst for crypto markets, he believes that the price action before and after the event could actually be negative. Hayes pointed out that when most market participants agree on a certain outcome, the opposite often occurs, leading him to believe that Bitcoin and crypto prices could slump around the halving.
Hayes has decided to abstain from trading until May, citing the tighter dollar liquidity at the time of the halving as a factor that could contribute to a potential firesale of crypto assets. Despite his bearish inclinations, Hayes remains optimistic about the long-term prospects of the crypto market, stating, “I’m perennially long as fuck crypto, so I welcome being wrong.”
The crypto veteran also revealed that he recently took profit in Solana and the Solana-based memecoin “cat in a dog’s world,” placing the proceeds into Ethena’s USDe stablecoin to earn yield. Ethena is a synthetic dollar protocol that aims to provide a crypto-native solution for money not reliant on traditional banking system infrastructure.
Hayes’ warning comes at a time of heightened volatility in the crypto market, with investors advised to do their due diligence before making any high-risk investments. The Daily Hodl, where Hayes’ analysis was published, does not recommend buying or selling cryptocurrencies and digital assets, and reminds readers that all transfers and trades are at their own risk.
As the crypto market braces for the upcoming Bitcoin halving, Hayes’ cautionary words serve as a reminder of the unpredictability of the market and the importance of staying informed and vigilant.
