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According to a recent X post by crypto entrepreneur Arthur Hayes, Bitcoin (BTC) probably hit its bottom during the plunge to $77,000 on March 10. However, Hayes cautioned that while BTC may have bottomed, stock markets could face more pain ahead.
BTC Bottomed At $77,000? Hayes Thinks So
Former BitMEX CEO Arthur Hayes recently took to X to declare that BTC may have likely bottomed at $77,000. The acclaimed crypto market commentator referred to the US Federal Reserve’s (Fed) latest remarks signaling the end of quantitative tightening (QT). Hayes remarked:
JAYPOW delivered, QT basically over Apr 1. The next thing we need to get bulled up for realz is either SLR exemption and or a restart of QE. Was BTC $77K the bottom, prob. But stonks prob have more pain left to fully convert Jay to team Trump so stay nimble and cashed up.
For the uninitiated, QT is one of the Fed’s monetary policies aimed at reducing the money supply by selling off assets like government bonds or letting them mature without reinvesting. While this helps control inflation, it can also lead to higher interest rates and slower economic growth.
The Fed began its most recent QT cycle nearly three years ago in June 2022 to combat high inflation resulting from COVID-era economic stimulus. Now that inflation appears to be easing, the Fed has little reason to continue QT.
Yesterday, the Fed announced that from April 1 onwards, it will slow the pace of its balance sheet drawdown. Such a shift in monetary policy is likely to benefit risk-on assets like BTC and stocks.
As stated in his X post, Hayes emphasized that the next potential bullish catalysts could be either a Supplementary Leverage Ratio (SLR) exemption or the start of quantitative easing (QE).
To explain, the SLR exemption temporarily allowed banks to exclude certain assets, like US Treasuries and central bank reserves, from their leverage calculations to encourage lending and support financial markets during crises. Similarly, QE is a monetary policy through which the Fed increases the money supply in the economy, potentially benefiting high-risk assets like BTC.
Axie Infinity co-founder Jeff Jirlin echoed Hayes’ sentiments, stating that an end to QT from April onwards would be “great for both crypto and equity markets.” Jirlin added that the current monetary policy is the tightest he has observed since 2010.
Bitcoin Not Out Of The Woods Yet
While market optimism has increased following the Fed’s recent comments, the premier cryptocurrency is not fully out of the woods yet. For instance, BTC recently broke down through a 12-year trend line against gold, raising fears of heightened economic uncertainty in the near term.
Further, CryptoQuant CEO Ki Young Ju recently spooked the market by declaring that the Bitcoin bull run is likely over. At press time, BTC trades at $85,203, up 2% in the past 24 hours.
Featured image from Unsplash, Chart from TradingView.com
Ash is a dedicated crypto researcher and blockchain enthusiast with a passion for diving deep into the evolving world of decentralized technologies. With a background in writing and a natural curiosity for how digital assets are shaping the future, he has immersed himself in various sectors of the cryptocurrency space, including decentralized finance (DeFi), NFTs, and liquidity mining. His journey into crypto started with a desire to fully understand the technology behind it, leading him to explore and engage with these systems firsthand.
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Beyond DeFi and NFTs, Ash explores a wide array of emerging blockchain applications. His research spans areas like cross-chain technologies, decentralized governance, and blockchain’s potential to integrate with traditional finance. He is continuously learning and adapting to the latest developments, ensuring that his insights are both timely and relevant. His interest extends to how these technologies are creating new possibilities for decentralization, transparency, and trust in a variety of industries.
Ash’s commitment to engaging with the crypto space firsthand gives him a unique perspective that goes beyond what can be learned from research alone. His practical involvement allows him to stay ahead of the curve, offering readers and enthusiasts a clear and comprehensive understanding of the rapidly evolving world of blockchain. Whether delving into the technical mechanics of DeFi or exploring the cultural impact of NFTs, Ash’s approach is always rooted in curiosity, research, and a desire to make this technology accessible to all.
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