Coinspeaker
Feb 25, 2025

Arthur Hayes Predicts Bitcoin Could Drop to $70,000 Amid Market Volatility

2 min

The cryptocurrency market is currently facing high volatility, with Bitcoin dropping 6.90% in the last 24 hours to below $89,266.65, marking a fall below the $90,000 threshold for the first time in over a month. This shift has raised concerns among investors.

  • BitMEX co-founder Arthur Hayes predicts Bitcoin could decline further to $70,000 if large hedge funds unwind their positions in US spot Bitcoin ETFs.
  • Outflows from ETFs like the BlackRock iShares Bitcoin Trust may contribute to this price drop.
  • Hedge funds are engaging in arbitrage by simultaneously going long on ETFs and shorting CME Bitcoin futures, which could lead to selling pressure as prices fall.
  • Hayes warns that if the basis spread narrows, these funds will liquidate their positions, potentially exacerbating the decline.

Hayes also expressed skepticism about the US Treasury's involvement in Bitcoin purchases, viewing it as politically motivated and detrimental to Bitcoin's price stability.

  • Analyst Ali Martinez advised caution, urging traders to remain patient given the volatile market conditions.
  • He noted liquidity in the crypto market has decreased by over 70% since December 2024, indicating a significant warning sign.
  • External factors, such as the Bybit exchange hack and controversies involving meme coins, have further impacted market sentiment.

These incidents have contributed to a loss of trust among crypto investors, according to Caroline Mauron, co-founder of Orbit Markets.