Bitcoin
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The bitcoin price has dropped back from year-to-date highs of just over $30,000 per bitcoin, with the ethereum price falling along with it—even as excitement over a possible end to Ripple’s long-running legal battle has helped XRP break out.
Now, after JPMorgan analysts issued a severe $1.1 trillion warning, the former chief executive of bitcoin and crypto exchange Bitmex Arthur Hayes has predicted a crypto market “powder keg” could go off as soon as this year.
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“You’re basically putting this powder keg together of a situation that’s going to be exploding in [the third and fourth quarter] of this year, and I think, ultimately, it will be good for bitcoin,” Hayes, who now runs a family office called Maelstrom, told the What Bitcoin Did podcast. “It will be quite volatile on the upside and the downside.”
Bitcoin, ethereum and other major cryptocurrencies have cheered U.S. president Joe Biden’s debt ceiling deal; however, JPMorgan analysts last week warned that crypto and stock markets are now nervously eyeing what will happen when the U.S. Treasury tries to refill its coffers.
Hayes, who last year was sentenced to two years of probation after pleading guilty to charges he failed to implement an anti-money laundering (AML) program at Bitmex, pointed to this year’s banking crisis and expectations the U.S. government will issue just over $1 trillion in new Treasury bills in coming months, potentially sucking hundreds of billions of dollars from the market, as contributing to the “powder keg.”
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The bitcoin price has swung wildly over the last few years, pulling the ethereum price with it.
Next year, bitcoin will undergo its fourth so-called halving supply cut and Hayes expects the bitcoin price to surge in its aftermath, as it has done previously.
“I don’t think we get up to $70,000 this year, I think next year is when we cross that barrier, then we get the blow off top [2025], [2026] and then it’s Armageddon,” Hayes said, referring to a significant societal upheaval such as a major war that could cause a mass panic and a sell-off of all assets, including bitcoin, ethereum and crypto.
“It doesn’t have to be too straightforward, we just have this situation, we have this tinderbox of too much money, no trust and people trying to eke out a living for themselves,” Hayes added.
