BitMEX CEO sees BTC and ETH plunging by late June

By Raffaele Redi

Bitcoin and ether both correlate strongly with the Nasdaq 100, according to Hayes

BitMEX CEO Arthur Hayes believes that the two leading cryptocurrenies, bitcoin (BTC) and ether (ETH), will plunge by the end of the second quarter of 2022, in what he called “crypto carnage”.

According to Hayes, the combination of the Ukraine conflict and the hawkish stances of the Federal Reserve and several other central banks could be fatal to cryptoassets’ prices, while NATO sanctions on Russia could push emerging economies to add bitcoin to their reserves in the long term.

Hayes’ analysis is based on the grounds that crypto charts are following a similar pattern to traditional stocks, which are expected to retrace considerably as soon as the US Fed starts pumping liquidity into the markets to counter high levels of inflation.

“Bitcoin and ether are highly correlated to the Nasdaq 100. If the NDX tanks, it will take crypto down with it,” Hayes said in a recent Medium post.

“By the end of the second quarter in June of this year, I believe bitcoin and ether will have tested these levels, bitcoin: $30,000 and ether: $2,500.”

The growth of altcoins

Although he conceded his short-term prediction could be wrong, and claimed to be bullish on lead cryptos in the long term, Hayes said a possible drastic fall in the price of the digital gold and oil could lead investors to bet on altcoins – as he has been doing himself.

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“There isn’t much science to these numbers other than a gut feeling. The annoying part is that there are some altcoins I have begun to accumulate because the prices are quite attractive,” he said.

“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 such, I am buying crash June 2022 puts on both bitcoin and ether.

“Nothing is certain, I only ascribe probabilities to outcomes and trade accordingly. I fully believe there’s a chance my market prognosis might be wrong. That is fine, in that case, I only lose the option premium paid on my crash protection.

“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. This analysis is purely an attempt to trade a short-term situation that I believe will transpire in risk markets and hedge purchases of attractively priced altcoins,” said Hayes.

ETH/USD price history

Date Close Change Change(%) Open High Low
Dec 3, 2022 1289.15 -6.45 -0.50% 1295.60 1305.90 1282.51
Dec 2, 2022 1295.60 18.97 1.49% 1276.63 1297.73 1265.56
Dec 1, 2022 1276.50 -17.98 -1.39% 1294.48 1300.02 1259.75
Nov 30, 2022 1294.69 78.80 6.48% 1215.89 1309.65 1212.03
Nov 29, 2022 1215.91 48.86 4.19% 1167.05 1226.68 1158.28
Nov 28, 2022 1167.04 -26.14 -2.19% 1193.18 1198.74 1150.50
Nov 27, 2022 1193.17 -11.82 -0.98% 1204.99 1222.69 1188.49
Nov 26, 2022 1205.03 6.69 0.56% 1198.34 1234.05 1195.61
Nov 25, 2022 1198.35 -4.23 -0.35% 1202.58 1205.94 1169.66
Nov 24, 2022 1202.65 19.28 1.63% 1183.37 1216.42 1179.39
Nov 23, 2022 1183.35 45.31 3.98% 1138.04 1189.36 1126.32
Nov 22, 2022 1138.11 32.43 2.93% 1105.68 1141.38 1073.75
Nov 21, 2022 1105.62 -35.14 -3.08% 1140.76 1145.01 1078.20
Nov 20, 2022 1140.64 -76.79 -6.31% 1217.43 1225.95 1131.03
Nov 19, 2022 1217.27 5.45 0.45% 1211.82 1232.54 1196.76
Nov 18, 2022 1211.92 11.79 0.98% 1200.13 1232.71 1198.39
Nov 17, 2022 1200.21 -15.57 -1.28% 1215.78 1227.61 1181.10
Nov 16, 2022 1215.76 -36.04 -2.88% 1251.80 1267.09 1185.10
Nov 15, 2022 1252.06 10.85 0.87% 1241.21 1289.18 1231.70
Nov 14, 2022 1241.22 21.60 1.77% 1219.62 1288.67 1169.14

Further reading

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