Arthur Hayes, the founder of BitMEX, has issued a warning to the crypto market, predicting a potential slump in prices around the upcoming Bitcoin halving event. Despite the common belief that the halving will have a bullish effect on prices, Hayes argues that the market sentiment may actually lead to a temporary downturn.
In his analysis, Hayes points out that the halving, scheduled for April 20th, is expected to reduce the block reward for miners, which is typically seen as a positive catalyst for crypto prices. However, he believes that the consensus around the halving being bullish could result in a contrary outcome, causing prices to drop instead.
Hayes has decided to abstain from trading until May, citing the tight dollar liquidity and the potential for a “raging firesale” of crypto assets around the halving. He recently took profit in Solana and a meme coin called “cat in a dog’s world,” moving the proceeds into Ethena’s USDe stablecoin for staking.
Ethena is a synthetic dollar protocol that aims to provide a crypto-native solution for money without relying on traditional banking infrastructure. Hayes is an investor in the project, which he sees as a way to earn yield on stablecoins while avoiding the low returns offered by Tether and Circle.
While Hayes acknowledges that the market could defy his bearish predictions and continue to rise, he remains optimistic about the long-term prospects of crypto. He emphasizes the importance of doing due diligence before making high-risk investments in Bitcoin and other digital assets.
As the crypto market braces for potential volatility in the coming weeks, Hayes’ warning serves as a reminder to investors to stay cautious and informed. Subscribe to The Daily Hodl for more updates on price action and follow them on social media for the latest news in the crypto space.
