Leggi questo articolo in Italiano
Arthur Hayes and the “worst case scenario” for Bitcoin
By Davide Grammatica
With Bitcoin at a peak, investors are now looking for the “bottom”: according to Arthur Hayes, the first cryptocurrency could fall as low as $70,000
A phase of suffering begins for Bitcoin
With an increasingly “depressed” market and new outflows that are recording on the ETF front, many investors seem to be convinced that a new bearish phase could begin for Bitcoin.
Among the first in line of these is certainly Arthur Hayes, former CEO of BitMEX and point of reference for the crypto community, who has analyzed a (in his opinion) particularly “bearish” dynamic that is characterizing the actions of institutional operators.
Many BTC spot ETF holders are in fact about to change their common strategy of arbitrage, that is to say going long on the ETF and shorting futures contracts, to guarantee a low risk return that is still higher than that of US Treasury bonds.
However, with BTC below $90k, this strategy could be compromised, as the spread between BTC and spot and futures is too narrow. In the long run, the funds may no longer have an incentive to hold the ETFs, triggering a real mass sell-off. Moreover, if they were to relaunch short positions, the acceleration in BTC sales could be massive.
#Bitcoin goblin town incoming:
Lots of $IBIT holders are hedge funds that went long ETF short CME future to earn a yield greater than where they fund, short term US treasuries.If that basis drops as $BTC falls, then these funds will sell $IBIT and buy back CME futures.
These… pic.twitter.com/3PskTxrBPR
— Arthur Hayes (@CryptoHayes) February 24, 2025
The danger of an exodus from ETFs
The fact that many hedge funds are already in profit also suggests that they will not miss this opportunity, due to a dynamic that could crush BTC to $70,000.
The evidence that something is changing comes directly from ETFs. After two consecutive weeks of net outflows, outflows have accelerated sharply in recent days. On February 24 alone, BTC spot ETFs recorded their largest daily outflows in seven weeks, with a net outflow of $517 million.
BlackRock‘s IBIT lost $159 million, while Fidelity‘s FBTC lost as much as $247 million. It therefore seems likely that investors are rethinking their positions.
If hedge funds start to abandon their BTC ETFs, the crypto market could experience significant volatility. At the same time, long-term holders and retail investors may try to take advantage of new opportunities offered by the market, evaluating new buying opportunities.
