In the latter half of the year, significant volatility in Bitcoin is anticipated by former BitMEX CEO Arthur Hayes. He predicts an imminent “powder keg” explosion resulting from the United States banking crisis and escalating national debt.
During a recent appearance on the What Bitcoin Did podcast, Hayes shared his predictions on the current economic outlook and the future price of Bitcoin.
The Impact of Quantitative Easing and Social Disquiet
Hayes identifies quantitative easing, the practice of increasing the money supply, and growing social unrest as the two main drivers that could trigger a major market event leading to a significant decline in both equity and cryptocurrency prices.
He highlights the federal government’s issuance of trillions of dollars in debt to fund themselves amidst the ongoing banking crisis. This combination of factors creates a precarious situation that is expected to reach a critical point in the third or fourth quarter of this year.
Bitcoin’s Price Outlook
While Hayes believes that the current economic climate will ultimately benefit Bitcoin, he predicts heightened volatility both on the upside and downside throughout the remainder of the year.
Contrary to some optimistic projections, Hayes suggests that Bitcoin will not surpass the $70,000 mark until 2024. Instead, he envisions a “blow off top” occurring in 2025 or 2026, followed by a significant downturn.
Other Analyst Perspectives
Although Hayes offers a cautious outlook for Bitcoin, other experts hold more positive views in the short term. Tommy Honan, the head of market analysis at crypto exchange Swyftx, suggests that a debt deal could trigger a surge in Bitcoin’s price, drawing traders back into the market.
Additionally, JPMorgan strategists propose a potential Bitcoin price of $45,000 based on the current price of gold and the upcoming halving event in the cryptocurrency.
Hayes’ Personal Investment Strategies
Hayes shared some of his own investment strategies. He also revealed his interest in staking Ether and closely monitoring the development of Bitcoin Ordinals. Additionally, he mentioned his investment in Pepe (PEPE), a memecoin with a frog-themed concept, which experienced a significant rally shortly after its launch.