Bitcoin Drops 6.7% Amid Hayes' $75,000 Prediction, Market Volatility

Bitcoin, the world's leading cryptocurrency, is facing a potential downturn as BitMEX founder Arthur Hayes predicts a significant drop in its value. Hayes anticipates that if Bitcoin's price falls below a key support level, it could plummet to as low as $75,000. This prediction comes amid heightened volatility in the cryptocurrency market, with Bitcoin's price experiencing substantial fluctuations over the past week.

Hayes' forecast is based on the high open interest in the $70,000-$75,000 range, which could trigger significant price swings if the price of Bitcoin drops into this zone. The total crypto market capitalization has already seen a decline, sinking 6.7% to $2.7 trillion, indicating increased selling pressure across risk assets. This trend has led to concerns that Bitcoin's price could drop even further in the coming months.

Bitcoin started the new week with increased volatility, dropping to $80,000 on Sunday before surging to above $82,000 in the early hours of Monday. This volatility has been exacerbated by the lack of immediate government purchases of Bitcoin, which had been anticipated by many investors. The U.S. Strategic Bitcoin Reserve, established through an executive order, is currently funded through confiscated assets from criminal and civil forfeitures, rather than direct government purchases.

The absence of a detailed roadmap for future Bitcoin acquisitions has fueled market uncertainty, despite the authorization of “budget-neutral” strategies. The White House Crypto Summit, which followed the executive order, received mixed reactions from the crypto community, with many expressing disappointment at the lack of major, market-moving news or policy changes. The event was seen by some as a typical “sell the news” event, where initial hype leads to a subsequent sell-off.

Macroeconomic pressures and escalating trade tensions are also contributing to the bearish trend in the cryptocurrency market. Ongoing trade tensions between the U.S. and key trading partners, including China and Canada, show no sign of cooling off. The U.S. has imposed tariffs on imports from these countries, leading to retaliatory measures and concerns about escalating inflation. Economists warn that Trump’s tariff policies could exacerbate inflation, making rate cuts harder and reducing investor appetite for speculative assets like crypto.

Increased inflation could reduce investor appetite for speculative