Introduction
Former Bitmex CEO Arthur Hayes has issued a cautionary statement regarding a possible 30% correction in the bitcoin market. In a recent Medium post, Hayes also discussed the impact of spot bitcoin exchange-traded funds (ETFs) on the price of bitcoin. With the U.S. Securities and Exchange Commission (SEC) expected to approve multiple spot bitcoin ETFs soon, Hayes believes that the market could experience an even more severe correction.
Hayes' Bitcoin Price Forecast
In his Medium post, Hayes outlined his bitcoin price forecast, anticipating a healthy 20% to 30% correction in the early part of March. He also stated that if the slate of U.S.-listed spot bitcoin ETFs has already begun trading, the correction could be even more significant. Hayes emphasized the potential for a dollar liquidity rug pull, which could result in a 30% to 40% correction in the bitcoin market.
Factors Influencing the Correction
Hayes identified three key variables that he expects to "collide with each other in March." Firstly, he highlighted the Fed's Reverse Repurchase Operations (RRPs) or reverse repo, predicting that the RRP balance will reach $200 billion early in March. He stated that there needs to be another source of dollar liquidity supplied to sustain the market's momentum.
Secondly, Hayes mentioned the need for banks to find cash to swap with U.S. Treasuries and other eligible bonds they repo'd with the Fed by March 12. This requirement could impact the liquidity of the market. Lastly, he discussed the possibility of the Fed initiating its first rate cut since March 2021 at the Federal Open Market Committee (FOMC) meeting on March 20. This potential rate cut could further impact the market.
Spot Bitcoin ETFs
Hayes also addressed the potential impact of spot bitcoin ETFs on the market. He highlighted the anticipation of significant fiat inflows into these ETFs, which could drive bitcoin's price above $60,000 and close to its 2021 all-time high of $70,000. However, he warned that this could lead to a 30% to 40% correction due to a potential dollar liquidity rug pull.
Currently, there are 11 spot bitcoin ETF proposals filed with the SEC, and trading could begin as early as January 11. Hayes emphasized the need for bitcoin derivatives as a liquid macro crypto hedge, given the liquidity challenges associated with other cryptocurrencies.
Conclusion
In conclusion, former Bitmex CEO Arthur Hayes is cautioning about a potential 30% correction in the bitcoin market. He believes that the correction could be even more severe if the slate of U.S.-listed spot bitcoin ETFs has already commenced trading. As the market awaits the SEC's decision on these ETFs, it remains to be seen how these factors will influence the price of bitcoin and the overall cryptocurrency market.
What are your thoughts on Hayes' predictions? Share your opinions in the comments section below.
Frequently Asked Questions
Is it a good idea to open a Precious Metal IRA
It is essential to be aware of the fact that precious metals do not have insurance coverage before opening an IRA. It is impossible to get back money if you lose your investment. All your investments can be lost due to theft, fire or flood.
Protect yourself against this type of loss by investing in physical gold or silver coins. These items can be lost because they have real value and have been around for thousands years. These items are worth more today than they were when first produced.
When opening an IRA account, make sure you choose a reputable company offering competitive rates and high-quality products. Consider using a third-party custody company to keep your assets safe and allow you to access them at any time.
When you open an account, keep in mind that you won't receive any returns until your retirement. Remember the future.
What's the advantage of a Gold IRA?
The benefits of a gold IRA are many. It can be used to diversify portfolios and is an investment vehicle. You can control how much money is deposited into each account as well as when it's withdrawn.
You also have the option to transfer funds from other retirement plans into a IRA. This allows you to easily transition if your retirement is early.
The best thing is that investing in gold IRAs doesn't require any special skills. They are readily available at most banks and brokerages. You do not need to worry about fees and penalties when you withdraw money.
But there are downsides. The volatility of gold has been a hallmark of its history. It is important to understand why you are investing in gold. Are you seeking safety or growth? Is it for insurance purposes or a long-term strategy? Only after you have this information will you make an informed decision.
If you want to keep your gold IRA open for life, you might consider purchasing more than one ounce. One ounce doesn't suffice to cover all your needs. Depending upon what you plan to do, you could need several ounces.
A small amount is sufficient if you plan to sell your gold. Even one ounce is enough. These funds won't allow you to purchase anything else.
What is the best precious metal to invest in?
Answering this question will depend on your willingness to take some risk and the return you seek. Gold has been traditionally considered a haven investment, but it's not always the most profitable choice. Gold may not be right for you if you want quick profits. If you have the patience to wait, then you might consider investing in silver.
If you don’t desire to become rich quickly, gold may be your best option. Silver may be a better option for investors who want long-term steady returns.
Statistics
- If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
- (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (smartasset.com)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
External Links
irs.gov
forbes.com
- Gold IRA: Add some sparkle to your retirement nest egg
- Understanding China's Evergrande Crisis – Forbes Advisor
finance.yahoo.com
cftc.gov
How To
Gold IRAs are a growing trend
As investors seek to diversify their portfolios while protecting themselves from inflation, the trend towards gold IRAs is on the rise.
Gold IRA owners can now invest in physical gold bullion or bars. It can be used for tax-free growth and provides an alternative investment option for those concerned about stocks and bonds.
Investors can manage their assets with a gold IRA without worrying about market volatility. Investors can protect themselves from inflation and other possible problems by using the gold IRA.
Investors also enjoy the benefits of owning physical gold, which includes its unique properties such as durability, portability, and divisibility.
Additionally, the gold IRA has many benefits. It allows you to quickly transfer your gold ownership to your heirs. The IRS doesn't consider gold a commodity or currency.
Investors who seek financial stability and a safe haven are finding the gold IRA increasingly attractive.
—————————————————————————————————————————————————————————————–
By: Kevin Helms
Title: Former Bitmex CEO Arthur Hayes Warns of Potential 30% Bitcoin Market Correction
Sourced From: news.bitcoin.com/former-bitmex-chief-predicts-30-btc-correction-warns-spot-bitcoin-etfs-could-make-it-worse/
Published Date: Mon, 08 Jan 2024 02:30:37 +0000
Related posts:
Former Bitmex CEO Arthur Hayes: Success of Spot Bitcoin ETF Could Spell Disaster for Bitcoin
Justice Department Seeks to Restrict Ex-Binance CEO’s Travel Before Sentencing
Former SEC Official Warns Spot Bitcoin ETFs Will Create ‘Wall Street Fee-Sucking Scam of Epic Proportions’
Gold and BTC Rise as Key US Equities Index Declines Over 10% from July 31 Peak
