Former BitMEX CEO Arthur Hayes predicts bitcoin could drop to US$30,000 as tech stocks plummet

BitMEX co-founder and former CEO Arthur Hayes expressed his short-term outlook on how the ailing tech stock markets caused by the Russian-Ukraine war might lead to a crypto market crash before the end of June in his latest blog post.

He predicts that Nasdaq 100 (NDX) will drop by 30 - 50%, which will have a domino effect, causing bitcoin to drop to US$30,000 and that the same would drive Ethereum’s price down to US$2,500 by June. He explains that the two largest cryptocurrencies are “highly correlated” to the  Nasdaq 100 index.

He writes that “our inability to recognise the cyclical nature of markets leads us to ignore inconvenient truths” about cryptocurrency. The inconvenient truth being that cryptocurrency is falling along with US technology stocks amid the Russian-Ukraine war. He remains bullish on its long-term growth but bearish short term.

In the same vein, he argues that the Nasdaq 100 will go down because of the Russian-Ukraine invasion, which will in turn impact crypto markets. As well as higher global interest rates and inflation. 

The third element is based on looking at the chart for the Nasdaq 100. Hayes says that the tech index failed to bounce significantly on a key technical level, suggesting that it may go lower.

“Even though some of these coins are already down 75% from their all- time high, I don't believe even they can escape the coming crypto carnage," as a result, he’s buying options to hedge against the market crashes in Q2.

In the blog post, Hayes wrote that he believed the end of  the “Petro Dollar / Euro Dollar monetary system” is near because of the U.S’s inability to confiscate fiat reserve assets of the Russian Central Bank. He writes that bitcoin will reach US$1million and gold US$10,000 and suggests investors to hold and hoard the two assets.

“The crypto capital markets are the only free markets left globally. As such, they will lead equities lower as we head into the downturn, and lead equities higher as we work our way out of it. Bitcoin and Ether will bottom well before the Fed acts and U-turns its policy from tight to loose.”

Hayes concludes his blog post by stating that his prediction “might be wrong” and he’s okay with that. He writes, “I will be wrong if the correlation between bitcoin / ether and NDX starts dropping before a crash in risk asset markets. I’m perfectly okay with that outcome, as I’m already in a long crypto position.” If his predictions are wrong, he will only lose the premium he paid for cash protection.

Despite the short-term bearish outlook, Hayes is still bullish on the long-term potential of cryptocurrency and he predicts that bitcoin will  reach US$1 million in three- to five-years. 

Photo: Arthur Hayes