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Former Bitmex CEO Arthur Hayes predicts a bearish cryptocurrency market and urges investors to consider the prospects for NFT and the metaverse.
Investor Arthur Hayes said that the bankruptcy of the Chinese devloper Evergrande and the policy of the US Federal Reserve System (FRS) aimed at reducing dollar liquidity will negatively affect the cryptocurrency market.
“The Fed will continue to tighten monetary conditions until stocks fall or some portion of the US Treasury market stops functioning properly.”
Hayes stresses that a bearish stock market could induce the Fed to return to the practice of quantitative easing and the uncontrolled release of the dollar. Based on these forecasts, it will be very difficult for bitcoin to return to $ 69,000 or ether to $ 5,000. According to Hayes, investors should expect a “flat” with periodic ups and downs.
Therefore, he urges investors who are just about to enter the cryptocurrency market in winter to wait for the Fed rate hike in March or June 2022, and only after that invest in crypto assets. For investors who are already trading in the cryptocurrency market, the expert suggests considering the possibility of investing in cryptocurrencies of gaming projects in order to earn money on the metaverse or NFT. Hayes believes that their growth is not directly related to the economy and depends on other factors that can support their growth.
At the same time, the analytical company Huobi Research predicts that the Fed will begin to reduce liquidity in June 2022 due to a gradual decrease in the volume of government purchases of bonds, which will lead to a decrease in the cost of cryptocurrencies. The study says that if the decline in bond purchases accelerates, the cryptocurrency market will decline even faster. Renowned investor and economist Louis Nallier believes that a significant bubble has inflated in the stock market, which could lead to a strong correction of risky assets. In his opinion, in this case, Bitcoin may fall to $ 10,000.
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