In a recent blog post, Arthur Hayes, CEO of BitMEX, expressed his views on the economy, quantitative tightening, and Bitcoin‘s price behavior near the Bitcoin halving event. On April 8, BTC experienced an unexpected surge to hit $72,000 and has since shown resilience. The crucial issue is whether Bitcoin can sustain its price around the all-time high as we draw closer to the halving event.
Bitcoin Price Volatility Around Halving Event
According to Arthur Hayes’ latest prediction, Bitcoin’s price is expected to decrease not only before but also after the upcoming halving event. He believes that during this time, there will be reduced US dollar liquidity available, leading to increased selling pressure on cryptocurrencies. However, he anticipates that the quantitative tightening (QT) cycle will become less stringent starting from May 1st, returning to its usual pace based on US inflation patterns.
Bitcoin halvings are generally considered to be positive events for the cryptocurrency market. In the long run, I believe this will lead to a price increase. However, it’s important to note that the price trend just prior to and following the halving could potentially be downward.
According to cryptocurrency expert Rekt Capital’s assessment, Bitcoin seems to be transitioning from its Pre-Halving Correction period to a “Re-Gathering” stage. During this phase, Bitcoin aims to move laterally before and after the Halving occurrence.
In most cases, the period for Bitcoin to regain lost ground after a halving event can last anywhere from several weeks to around 150 days, equivalent to about five months. During this phase, some investors might grow anxious due to feelings of boredom, impatience, and dissatisfaction with the absence of substantial returns on their Bitcoin investments following the halving. It’s important to note that in this specific cycle, the range for Bitcoin’s price to re-accumulate is forming near new record highs for the first time.
Eyes on the Fed Rate Cuts
This week in the crypto market, we have two significant occurrences approaching: the release of the March Consumer Price Index (CPI) data and the Federal Open Market Committee (FOMC) meeting. The focus lies on the Fed’s intentions regarding interest rate cuts based on these events.
According to Galaxy Digital CEO Mike Novogratz, even though there aren’t strong arguments, the Federal Reserve could nonetheless decide to reduce interest rates. In his view, such a decision would be advantageous for assets including Bitcoin ($BTC), gold, silver, and copper.
I find it hard to believe that the Fed will lower interest rates given the current situation. However, I suspect they might do so, which could benefit assets like Bitcoin, gold, silver, and copper. Unfortunately, this isn’t good news for the USA as we need a political leader who is willing to significantly reduce spending.
Sound of silence…
— Mike Novogratz (@novogratz) April 8, 2024
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2024-04-09 07:47