Bitcoin, crack or no crack? – After a year 2022 of depression and despair, this sudden bitcoin color recovery (BTC) is doing a world of good. The beginning of January could herald greener horizons for 2023. However, in this still turbulent macroeconomic context, prudence is still a must. This is whatArthur Hayesformer CEO of the BitMEX exchange, highlights in his detailed analysis. What will BTC do this year? Bullrun or announced crack? decryption.
Bitcoin price: Arthur Hayes’ predictions for 2023
Bitcoin in 2023, the different scenarios
The co-founder of the BitMEX platform, Arthur Hayes, already had it shared his insights late last year on the prospects for bitcoin price appreciation. At the time, he was clearly announcing color. Bitcoin will gorge itself over the next few years with the inevitable return of central bank magic money. Right now, October 2022, the price of Bitcoin fluctuates between $19,000 and $20,000. Consider a situation similar to today’s, a near FTX bankruptcy.
However, this is a long-term view that we, the crypto-savvy, have little doubt about. Central banks are what they are, in fact, money printing is not ready to stop. Nor the devaluation of our currencies. However, in the short term, in 2023, we would not be safe from another cataclysm… This is Arthur Hayes’ scenario which we will soon describe in detail.
First, what explains Bitcoin’s recent price rally?
- Bitcoin is experiencing a simple rebound on its $16,000 support, without a real fundamental question. In this case, the price of Bitcoin will continue to rise to this price level until liquidity returns favoring bull markets.
- These are the market players who anticipate the return of money printing of the FED (Federal Reserve of the USA) and of famous “pin “. In this case, two possibilities:
- Scenario A: Market players are wrong. The Fed remains on its side and it doesn’t rotate. Bitcoin will then likely return to visit its November 2022 lows.
- Scenario B: The The FED actually pivots. Bitcoin continues its ascent and the start of the next bull run begins.
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Hayes Theory: CPI numbers aren’t everything
For Hayes, we should have a mix of scenario 1 and scenario 2A. And it’s this doubt that keeps her finger from pressing the big green button.” Acquire “. Indeed, according to him, the inflation data measured by the indicator CPI (Consumer Price Index) they are definitely in decline. But they wouldn’t be those Jerome Powellthe patron saint of the Fed, is watching very carefully.
Typically, the purchasing power of Americans appears to be very little affected by rate hikes for the time being. Which encourages inflation and turns out to be in total contradiction with the goal that Powell set for himself. Thus, the FED director could still find many reasons to continue his rate hikes, taking the entire market behind him. However, the latter hates unpleasant surprises.
“If Powell ignores the CPI numbers and continues his money supply reduction, the US credit market will go into a crack phase, creating a “Oh shitty moment » for the Fed, forcing it to aggressively backtrack. »
Financial markets: soft landing or crack like in March 2020?
The question is therefore not whether the banknote printer will be revived, but when and how it will be. Will we avoid an accident or not in 2023? For Hayes, Powell is not underestimating inflation, which could lead him to continue his rate hikes. But he could very well underestimate the skin reaction of the markets once you pass the point of no return.
For Hayes, two events could prompt the FED to announce its pivot thus anticipated:
- Powell is actually building on the CPI figures, which have already been down for several months. After an inflation reabsorption, a soft landing and a micro-recession, the money machine restarts and here we are again with a vengeance. Spoilers: this is not Hayes’s thesis. This soft landing is as likely to happen as temporary inflation last year.
- The US credit market cracks somewhat, leading to a March 2020-style market crash. The panic-stricken Fed urgently schedules a crisis conference to announce the end of monetary tightening (QT, Quantitative tightening in English) and the relaunch of automatic ticket machines (QE, Facilitation by quantity in English).
In both cases the the automatic ticket machine is reactivatedbut not in the same way. It is very likely that, in the coming years, Bitcoin will continue to soar to higher and higher horizons, driven inexorably by government money printing in abundance. However, in the short term, for the year 2023, there is still uncertainty. And the Bitcoin bear may well take a little dive into the depths first remove your muzzle from its den forever.
The dominoes are starting to fall one by one, allowing Bitcoin to gain a little more traction each day. For your part, don’t wait any longer to join the greatest of modern monetary revolutions! Register on AscendEX. To trade cryptocurrencies without spending a fortune, take advantage of a 10% reduction on trading fees (commercial link, see conditions on the site).