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 augur greener horizons for 2023. Nevertheless, in this still turbulent macroeconomic context, caution is still in order. That’s whatArthur Hayesformer CEO of the BitMEX exchange, highlights in its 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 us shared its insights at the end of last year about the outlook for bitcoin price appreciation. At that time, he was clearly announcing the color. Bitcoin will binge in the next few years with the inevitable return of central bank magic money. At this time, in October 2022, the price of Bitcoin fluctuates between $19,000 and $20,000. Consider a situation similar to today, a bankruptcy of FTX near.
However, this is a long-term view on which, in crypto-convinced, we have little doubt. Central banks being what they are, indeed, the money printing is not ready to stop. And neither is 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 that we will detail right away.
First of all, what explains the recent rally in the price of Bitcoin?
- Bitcoin is experiencing a simple rebound on its support from the 16,000 dollars, with no real fundamental demand. In this case, the price of Bitcoin will continue to eke out at this price level until the return of liquidity favoring bull markets.
- These are market players who anticipate the return of the money printing press of the FED (Federal Reserve of the USA) and the famous “pivot “. In this case, two possibilities:
- Scenario A: Market players are wrong. The Fed remains on its positions and does not rotate. Bitcoin will then likely return to visit its November 2022 lows.
- Scenario B: The FED actually pivots. Bitcoin continues its ascent and begins the start of the next bull run.
>> Do you want to trade Bitcoin and cryptocurrencies without breaking the bank? AscendEX opens its arms to you (commercial link) <<
The Hayes theory: CPI numbers aren’t everything
For Hayes, we should have a mix between scenario 1 and scenario 2A. And, it is this doubt that keeps his finger from pressing the big green button ” Purchase “. Indeed, according to him, the inflation figures measured via the indicator CPI (Consumer Price Index) are certainly on the decline. But, wouldn’t be the ones Jerome Powellthe patron saint of the Fed, is watching most intently.
Typically, the purchasing power of Americans seems for the moment to be very little affected by rate hikes. Which encourages inflation and turns out to be in total contradiction with the goal that Powell has set himself. Thus, the director of the FED could still find many reasons to continue his rate hikes, taking the whole of the market from the back. However, the latter hates unpleasant surprises.
“If Powell ignores the CPI numbers and continues his money supply reduction, it will drive the US credit market into a crack phase, creating a “oh shit moment » for the Fed, causing them to aggressively retrace their steps. »
Financial markets: soft landing or crack like in March 2020?
The question is therefore not whether the banknote printer will be relaunched, but when and how it will be. Will we avoid a crash or not in 2023? For Hayes, Powell does not underestimate inflation, which could lead him to continue his rate hikes. But he could well underestimate the epidermal reaction of the markets once the point of no return has been crossed.
For Hayes, two events could lead the FED to announce its pivot so anticipated :
- Powell is effectively basing himself on the CPI figures, which have been falling for several months already. A resorption of inflation, a soft landing and a microrecession later, the money machine is restarted and here we are again with a vengeance. Spoilers: this is not Hayes’ thesis. This soft landing is probably as likely to happen as last year’s temporary inflation.
- The U.S. credit market somehow cracks, leading to a March 2020-style meltdown in the markets. The FED, in a panic, urgently schedules a crisis conference to announce the end monetary tightening (QT, Quantitative Tightening in English) and the relaunch of the ticket machine (QE, Quantitative Easing in English).
In both cases, the ticket machine is relaunched, but not in the same way. It is highly likely that in the coming years, Bitcoin will continue to rally to ever-higher horizons, driven relentlessly by government money printing galore. However, in the short term, for the year 2023, there is still uncertainty. And the Bitcoin bear could well go for a little dip in the depths before take the snout out of its lair for good.
The dominoes are starting to fall one by one, allowing Bitcoin to gain a little more traction every day. On your side, don’t wait any longer to join the greatest of modern monetary revolutions! Go register on AscendEX. To trade cryptocurrencies without breaking the bank, take advantage of a 10% reduction on trading fees (commercial link, see conditions on site).