Bitcoin Price: Arthur Hayes Believes $80K Marks the Bottom

Summary:
Arthur Hayes, former CEO of BitMEX, shares his optimistic outlook on Bitcoin’s price, suggesting that the cryptocurrency has likely reached its lowest point at $80,000. With anticipated changes to U.S. liquidity, he believes conditions are favorable for a price recovery. The ongoing discussion about potential interest rate cuts by the Federal Reserve adds to the volatility in the market.

Key Takeaways:

Arthur Hayes predicts that Bitcoin has bottomed out at $80,000.
Upcoming changes in U.S. liquidity are expected to benefit cryptocurrency values.
The market remains volatile with speculations surrounding Federal Reserve rate cuts.

Bitcoin price $80K low was bottom, thinks Arthur Hayes

Hayes Predicts Bitcoin Price Recovery

Former BitMEX CEO Arthur Hayes has expressed confidence that Bitcoin has reached its price floor of $80,000, indicating a potential recovery in the near future. After experiencing a more than 35% decline from its all-time highs, Bitcoin fell to approximately $80,500 last week. However, Hayes believes that the downward trend is behind us.

He attributes this hopeful outlook to future U.S. liquidity trends, noting that the Federal Reserve is expected to conclude its current phase of quantitative tightening (QT) next month. This could lead to an increase in liquidity for cryptocurrency and other riskier assets. “Minor improvements in liquidity,” he explained to his followers.

Hayes anticipates that the Federal Reserve's balance sheet will stabilize soon and mentioned a rise in bank lending in November, which he believes will encourage a robust liquidity environment for Bitcoin and other altcoins. “We may fluctuate below $90k with one more dip into the low $80k range, but I think the $80k level will hold,” he asserted.

BTC/USD four-hour chart. Source: Cointelegraph/TradingView

Hayes maintained a bullish outlook despite Bitcoin’s recent downturn, emphasizing the necessity for a return to quantitative easing (QE) in order to alleviate price pressures. He suggested that a similar downturn in stocks is crucial before any recovery takes hold: “We are waiting for more money printing, and for that, AI tech stocks need to drop,” he added.

BTC/USD drawdowns from all-time highs. Source: Glassnode

Transitioning Market Sentiment

Expectations regarding changes to Federal Reserve policies have exhibited significant fluctuations amidst the recent U.S. government shutdown and other events.

Given the absence of substantial macroeconomic data, it has been challenging to predict the likelihood of another interest rate cut at the Fed’s upcoming December meeting. According to the latest figures from CME Group’s FedWatch Tool, the probability of a 0.25% rate reduction was approximately 79% as of Monday—a notable increase from just 42% a week earlier.

Fed target rate probability comparison (screenshot). Source: CME Group

This notable volatility has not gone unnoticed in the financial community. Economist Mohamed El-Erian remarked on this phenomenon, labeling it as “stunning.” He emphasized that such wild fluctuations contrast sharply with the “predictability and stability” that the Federal Reserve typically strives for, especially given its pivotal role in the global payments system.