Hayes thinks cryptocurrencies could collapse in the second quarter, which led him to invest in put options as a hedge. Since BTC and ETH have a high correlation with the Nasdaq-100 Index, he promised to buy the drop if that indicator stalled.
Bitcoin entrepreneur and BitMEX co-founder Arthur Hayes recently expressed a bearish short-term view on cryptocurrencies. He indicated it is impossible to recognize the cyclical nature of markets and the truth that Bitcoin moves in tandem with traditional stocks.
He predicted that the trend of Bitcoin to move alongside tech stocks means its price might drop to USD 30,000 in June.
The former CEO of BitMEX said cryptocurrencies could collapse in the second quarter due to the poor state of global stock markets. For that reason, he is investing input options as a hedge.
Hayes stated cryptocurrencies were moving along with US tech stocks and that the conflict between Russia and Ukraine would hurt both.
Although he is still bullish about the long-term prices of cryptocurrencies, he thinks they are on the edge of the cliff.
He said many people must decide whether to sell fiat money and buy cryptocurrencies, but he recommends being patient.
He explained a drop in the Nasdaq-100 Index would drag cryptocurrencies downward. Several charts show the correlation between traditional markets and cryptocurrencies, supporting that suggestion.
Why Arthur Hayes Argues that the Nasdaq-100 Index Will Drop
The impact of the invasion of Ukraine by Russia will slow down global growth due to higher commodity prices. Hayes thinks the continuation and possible escalation of the war between the two countries would hurt the share price.
While falling interest rates tend to support the Nasdaq-100 Index, higher ones currently emerge in response to inflation.
Based on the Nasdaq 100 chart, Hayes said the tech index did not bounce significantly at a crucial technical level, suggesting a drop.
BitMEX Co-Founder Makes Some Predictions about Cryptocurrencies
Arthur Hayes predicted the correction of the Nasdaq-100 Index in the crypto market would cause a strong ripple effect.
Hayes explained Bitcoin (BTC) and Ethereum (ETH) have a high correlation with the Nasdaq-100 Index. He promised he would buy the drop of June with both cryptocurrencies if that indicator stalled.
The entrepreneur believes Bitcoin and Ethereum will bottom out before the Fed changes its policy from strict to flexible. In addition, he forecast BTC and ETH would be trading at USD 30,000 and USD 2,500, respectively, by the end of the second quarter.
For that reason, Hayes said he has been accumulating other cryptocurrencies, given that they are much cheaper. He considers some of those coins would not be able to escape the upcoming crash despite being already 75% below their all-time highs.
Finally, the co-founder of BitMEX pointed out that the above is just a forecast, and he could be either right or wrong. He added he was only trying to trade a short-term situation that would occur in risk markets if altcoins had attractive prices.
By Alexander Salazar
