Key Points:
According to former BitMEX CEO Arthur Hayes, BTC should have bottomed out at $80,000 last week.
As the Federal Reserve is set to end quantitative tightening (QT), liquidity conditions are expected to turn favorable for cryptocurrency bulls.
Market speculation surrounding the Fed's future interest rate cuts remains highly volatile.
BTC will provide support for cryptocurrency bulls due to changes in U.S. liquidity conditions and should be able to maintain the $80,000 support level.
In his latest content on the X platform, former BitMEX CEO Arthur Hayes predicts a recovery in BTC prices.
BTC reached a recent low of $80,000 last week, down over 35% from its historical high, but Hayes believes the worst is over.
He explained to his X platform followers that the reason lies in U.S. liquidity trends. The Fed plans to end its latest round of quantitative tightening (QT) next month—its balance sheet will stop shrinking, injecting more liquidity into cryptocurrencies and risk assets.
"U.S. dollar liquidity has slightly improved," he summarized briefly.
Hayes predicts that the Fed's balance sheet should stop shrinking after this week, while he noted an upward trend in bank loans in November.
For the cryptocurrency market, the chain reaction should be quite clear: the typical trend of rising liquidity will drive BTC and altcoins up.
"We will consolidate below $90,000, possibly testing the $80,000 low again, but I believe the $80,000 support level will hold," Hayes further stated.
The former BitMEX executive has maintained a bullish outlook throughout the decline from the record high in October, reiterating earlier this month that a return to quantitative easing (QE) policies is needed to alleviate pressure on BTC prices.
Last week, he added that stocks need to experience a "sell-off" like cryptocurrencies before they can begin to recover.
"We are waiting for more money to be printed, for which we need a crash in AI tech stocks," he summarized.
Market expectations for changes in the Fed's financial policy experienced significant volatility during and after the U.S. government shutdown.
In the absence of macroeconomic data, betting on another interest rate cut at the Fed's December meeting has become uncertain.
According to the latest data from the CME FedWatch tool, as of Monday, the probability of a 0.25% rate cut is about 79%, up from just 42% a week ago.
This volatility has drawn widespread attention from professionals. Economist Mohamed El-Erian described this phenomenon as "shocking" in his comments.
"This extreme volatility is contrary to the 'predictability and stability' that the Fed typically seeks, especially as a central bank at the core of the global payment system," he pointed out on the X platform that day.
Related: Death Cross and $96,000 Rebound: 5 Things Bitcoin (BTC) Needs to Know This Week
This article does not constitute any investment advice or recommendation. All investment and trading activities carry risks, and readers should conduct their own research before making decisions.
Original article: “Arthur Hayes believes Bitcoin (BTC) $80,000 price low has bottomed out”
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