Arthur Hayes Says Bitcoin Bearish Short-Term, May Touch $50K

Arthur Hayes has predicted that Bitcoin may hit $50,000 during its choppy run but would rebound in late September.

BitMEX founder Arthur Hayes has flipped bearish on Bitcoin in the short term, predicting it might tend slowly and steadily toward the $50,000 region. He based his speculations on the rising reverse repurchase agreement (RRP), a factor tied to the imminent rate cut from the Federal Reserve.

Hayes stated in a Substack post that if the Fed does not cut interest rates before the September 18 meeting, Bitcoin will continue to fall. He emphasized that Bitcoin has underperformed when the RRP is on the rise. Hence, the upward trajectory of the index has heavily impacted Bitcoin’s price.

For context, the RRP is a transaction where a party sells a security to the counterparty with the agreement of repurchasing it at a higher price in times to come. A desk conducts the RRP, and it is usually a means firms use to source for quick capital or liquidity.

Hayes noted that an altcoin dive will accompany the imminent Bitcoin capitulation. Altcoins have always performed worse than Bitcoin during market downtrends due to their greater volatility, and Hayes sees a repeat when Bitcoin tends towards $50,000.

Buying the Dip

Howbeit, the BitMEX co-founder stated that he would be busy accumulating altcoins at discounted prices during the dip. Hayes noted he would focus on “solid shitcoins” with real value and utility. 

Although Hayes didn’t mention any of the assets he would be buying, it is worth noting that he has endorsed a couple of tokens like Etherna and Pendle in the past. The Crypto Basic reported he had stacked an ample amount of PENDLE during the asset’s bullish run in May.

Meanwhile, Hayes maintained a long-term bullish stance on the crypto market. He noted he was long on Bitcoin in an unleveraged manner, insinuating he held a significant amount of the asset in his portfolio.

A Late September Rebound

The ex-BitMEX CEO insinuated that the choppy Bitcoin trend will be shortlived as he sees a massive rebound late in September. According to him, the market would resume an upward trajectory “once the fiat liquidity taps are predictably ratcheted higher.”

Part of what will propel the market rebound will be the Fed interest rate cut on September 18. Risk assets such as Bitcoin have heavily profited from a reduction in borrowing rates, which encourages investors to spend. Hayes noted that he sees a minimum of 5% to 5.25% Fed funding rate slash.

Per an earlier report, Hayes asserted that the altcoins would surge significantly when Bitcoin reclaims $70,000 and Ethereum climbs to $4,000. He predicted that the bull run would take full effect when this happened.