Bitcoin Price Potentially Falls to $70,000, This is a Shocking Warning from Arthur Hayes!

Jakarta, Pintu News – The cryptocurrency market has been rocked by tremendous volatility, especially Bitcoin (BTC), which recently experienced a significant price drop. For the first time in over a month, the price of Bitcoin fell below the $90,000 (1.47 Billion IDR) level.

Bitcoin decline forecast according to Arthur Hayes

The current downturn in the market, especially Bitcoin, has caught the attention of many market observers, including Arthur Hayes, co-founder of BitMEX, who predicted a further decline.

According to Hayes, if hedge funds withdraw their funds from Bitcoin exchange-traded funds (ETFs), the price of Bitcoin could plummet to $70,000 (1.14 billion IDR).

Read also: Dogecoin Price Up 2% Today (2/26/25): DOGE Potential to Reach $45 Target?

This phenomenon is referred to by Hayes as “goblin town,” referring to the sharp drop that could occur. Several factors, including large moves by institutional investors, are expected to trigger more adverse price movements for Bitcoin in the near future.

Bitcoin ETFs and Hedge Fund Entry and Exit

One of the main factors that will affect the price of Bitcoin is the outflow of funds from Bitcoin ETFs, specifically from the iShares Bitcoin Trust (IBIT) managed by BlackRock. Many of the investors in these ETFs are hedge funds engaged in arbitrage strategies, which involve buying ETF shares while selling Bitcoin futures on the CME.

This strategy allows them to earn yields with low risk, exceeding the short-term yields of sovereign bonds. However, if the difference between the futures price and the spot price of Bitcoin (basis spread) narrows further, these hedge funds will most likely sell their ETF shares and buy Bitcoin futures again.

If these outflows occur on a large scale, it could trigger a Bitcoin price drop. At that point, many hedge funds that have profited from this arbitrage strategy will liquidate their positions and send the Bitcoin price into a freefall.

Hayes predicts that this will bring Bitcoin back to the $70,000 (1.14 Billion IDR) level, or even lower.

Potential Impact of US Government Policies on Bitcoin

Arthur Hayes also highlighted another external factor that could worsen Bitcoin market conditions, which is the role of the US government. He argues that Bitcoin’s volatility can be exploited by politicians for political gain, by buying or selling Bitcoin to influence the market.

Read also: Bitcoin Price Slumps to $88,000 Level Today (2/26/25): BTC Losses Enter Bear Market Territory!

Hayes even warned that the US government’s policies could pose a major threat to the price of Bitcoin, which is often used as a tool for political purposes rather than as a legitimate financial asset.

According to Hayes, Bitcoin’s falling price could be a tool used by certain parties to discredit current economic policies. In his view, Bitcoin is just one more financial asset being used in a big political game.

Market Analysis: The Role of Hedge Funds and the Decline in Liquidity

Several other analysts have shared similar views on Bitcoin’s downside potential. Ali Martinez, a prominent analyst, reminds investors to be patient in the face of high market volatility.

He advises not to rush into decisions, as the market is full of traps set by market makers. Martinez also reminded that the decrease in liquidity in the cryptocurrency market since December 2024 contributed greatly to this price drop.

In addition, there have been some major incidents in the cryptocurrency world, such as the hack on the Bybit exchange and the meme coin scandal involving the President of Argentina, adding to the sense of uncertainty among investors.

This negative sentiment further exacerbates the market situation and adds pressure to the Bitcoin price.

Overall, with various factors affecting the price of Bitcoin (BTC), investors should be more cautious. Predictions of further declines, coupled with warnings from experts, make this an uncertain time for those involved in the crypto market.

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*Disclaimer

This content aims to enrich readers’ information. Pintu collects this information from various relevant sources and is not influenced by outside parties. Note that an asset’s past performance does not determine its projected future performance. Crypto trading activities have high risk and volatility, always do your own research and use cold cash before investing. All activities of buying and selling bitcoin and other crypto asset investments are the responsibility of the reader.

Reference:

• CoinSpeaker. Arthur Hayes Shares Grim Outlook on Bitcoin (BTC) Price Crash. Accessed on February 26, 2025
• Cointelegraph. Bitcoin Could Be Headed for $70K, Goblin Town ETF Exodus: Hayes. Accessed on February 26, 2025