In the coming months, the price of Bitcoin may experience a correction of 20-30% due to decreased dollar liquidity. About it warned ex-CEO of BitMEX Arthur Hayes.
In an article on the Substack platform, he outlined the possible risks for American banks and markets that they could potentially face in early spring.
Hayes estimates that by early March the balance of the program would reverse REPO Fed will fall to $200 billion, the historical average, which he called “zero.” At its peak in late 2022, this liquidity facility was worth more than $2.5 trillion.
The second factor will be the end of the emergency bank financing program. The banks that received support within its framework must find funds to purchase treasury bonds by March 12, the expert recalled.
According to his forecast, the Ministry of Finance will not agree to extend the program in the year of presidential elections. Hayes admitted that this would lead to the bankruptcy of several banks. Combined with a reduction in liquidity, the next crisis will hit all financial markets, including cryptocurrency, the founder of BitMEX believes.
Hayes also noted that the Federal Reserve will meet on March 20, at which the agency will presumably lower the key rate by 0.25%. Markets estimate the probability of such a development at 75%. The weakening of the regulator’s monetary policy could have a positive impact on the Bitcoin exchange rate, the expert believes.
He stated that he “loaded up” with cryptocurrency in the second half of 2023 and does not intend to engage in trading until April due to these risk factors.
Source: Cryptocurrency
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