Why is Bitcoin Price Plummeting? An In-Depth Explanation from Arthur Hayes

Jakarta, Pintu News – In his latest essay on Substack titled “Snow Forecast,” published on November 17, 2025, Arthur Hayes provides an in-depth analysis of the cause of Bitcoin’s sharp price drop from its highest peak in October.

According to Hayes, the tightening of dollar liquidity and the drying up of derivatives-driven “fake” flows are the main culprits. Bitcoin, dubbed the “free-market mecca of global fiat liquidity,” moves more based on expectations of future money supply than day-to-day news.

Arthur Hayes’ view

Hayes recalls the chaos of “US Liberation Day” on April 2, 2025, when the Trump administration’s aggressive tariff measures briefly sparked fears of a depression. After Trump announced a tariff ceasefire on April 9, which Hayes called “TACO,” he predicted “Only Up!” Bitcoin then rose about 21%, followed by Ether and a few “select shitcoins,” while Bitcoin’s dominance fell from 63% to 59%.

Although his USD Liquidity Index is down about 10% since April 9, Bitcoin price is still up 12%. Hayes explains that the discrepancy is not a structural separation, but rather a temporary distortion created by the base trading of ETFs and Digital Asset Treasury (DAT) vehicles.

Also Read: Gold Outperforming Bitcoin? Asset Performance Analysis in 2025

US Government Response

Hayes returned to his central premise that “money is politics.” He stated that it is time for President Trump and Treasury Secretary “Buffalo Bill” Bessent to “put up or shut up”: they must use the Treasury to “pound the Fed, create another housing bubble, hand out more stimulus checks,” or they are “a bunch of cowards.”

Hayes has adjusted the positioning of his firm, Maelstrom. “Over the weekend, I increased our USD stable position in anticipation of a crypto price drop,” although the fund is still “very long.” The only token that he thinks can “outperform the negative dollar liquidity situation in the short term” is Zcash (ZEC).

Bitcoin Price Analysis

Bitcoin’s current correction, according to Hayes, is also a warning. “Bitcoin’s decline from $125,000 to the low $90,000s while the S&P 500 and Nasdaq 100 indices are around record highs suggests that a credit event is approaching.” He sees a potential 10-20% drop in equities and a 10-year US bond yield close to 5%.

Under such pressure, “Bitcoin could really drop to $80,000 to $85,000.” However, if it forces the Fed and the Ministry of Finance to “accelerate their money printing activities,” he believes Bitcoin “could surge towards $200,000 or $250,000 by the end of the year.”

At press time, BTC is trading at $90,477. Hayes’ analysis provides a deep insight into the current market dynamics and potential future direction of Bitcoin.

Also Read: 5 Reasons Solana (SOL) was Scooped Up by Institutions Despite Falling 30%: Whale’s Stealth Strategy?

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FAQ

What caused the recent Bitcoin price drop?

Bitcoin’s price decline is due to the tightening of dollar liquidity and the end of derivatives-driven “fake” flows, according to Arthur Hayes in his essay “Snow Forecast.”

How did Arthur Hayes predict Bitcoin’s price movement after “US Liberation Day”?

After “US Liberation Day,” Hayes predicted an “Up Only!” trend for Bitcoin, which subsequently rose about 21%, despite a drop in his USD Liquidity Index.

What does Hayes mean by “money is politics”?

According to Hayes, “money is politics” means that government actions, such as Ministry of Finance interventions and Fed policies, have a direct impact on the value of the currency and the economy as a whole.

What is Hayes’ prediction for the future price of Bitcoin?

Hayes predicts that if economic pressures force the Fed and the Ministry of Finance to increase money printing, the price of Bitcoin could jump to $200,000 or $250,000 by the end of the year.

Who is Arthur Hayes and what is his background?

Arthur Hayes is the founder of Maelstrom, and is known for his keen analysis of the crypto market. He often writes essays that provide insight into the dynamics of financial markets.

Reference

• NewsBTC. Why Is Bitcoin Price Crashing? Arthur Hayes. Accessed on November 20, 2025