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Bitcoin's $70K Drop, $250K Surge: Hayes' Bold Year-End Prediction

Coin WorldMonday, Jan 27, 2025 9:36 pm ET

1min read

Arthur Hayes, the former CEO of BitMEX, has recently shared his outlook on the future of Bitcoin's price trajectory. In a significant projection amidst current market dynamics, Hayes predicts that Bitcoin's value will drop to $70,000-$75,000 before rebounding to $250,000 by the end of the year.

Hayes attributes this decline primarily to macroeconomic trends, rather than the present turmoil related to DeepSeek, which he suggests could act as a catalyst for future growth. He emphasizes that US monetary policy and global factors will play crucial roles in Bitcoin's impending pull-back followed by its eventual growth.

Hayes has significantly adjusted his short-term outlook for Bitcoin. Earlier this month, he predicted that Bitcoin would peak in mid-March, but recent observations have prompted him to suggest that BTC is already nearing a substantial decline. He articulates a forecast of a $70,000 to $75,000 correction in Bitcoin, labeling it a mini-financial crisis, followed by a resumption of money printing that could propel Bitcoin to $250,000 by year-end.

According to Hayes, Bitcoin's immediate downturn can be traced to macroeconomic conditions characterized by tightening liquidity. Influential in this environment are rising US 10-year Treasury yields and the Federal Reserve's tightening policies, alongside reduced money supply growth in major economies such as the US, China, and Japan. These elements are creating financial stress that adversely affects fiat-priced assets, including Bitcoin, which Hayes has identified as particularly sensitive to fluctuations in global liquidity.

Hayes believes that these types of pullbacks occur often throughout the bull market, given how volatile Bitcoin is. He also references historical data that suggests similar patterns following major political events. Interestingly, while his initial assessments were not linked to the current upheaval stemming from DeepSeek, Hayes now perceives the situation as reinforcing his earlier predictions.

Despite Bitcoin ETFs achieving record volumes recently, long-term holders appear to be reacting by liquidating significant portions of their assets. Notably, firms such as MicroStrategy, which have heavily invested in BTC, are also facing challenges in the midst of market shifts.

Hayes cautions that political biases may interfere significantly with coherent economic policy. In a broader analysis, he examined varied economic strategies employed by countries and their

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