Former BitMEX CEO believes Bitcoin has reached its bottom
The former CEO of BitMEX Arthur Hayes believes that the price of bitcoin may have reached its lowest point now that the majority of “irresponsible businesses” have run out of bitcoin to sell. The worst may have happened for Bitcoin, as stated by the former CEO of the marketplace for cryptocurrency derivatives since there are no longer any Bitcoins available for sale by the “largest most irresponsible businesses.”
In an interview with podcaster Scott Melker on December 11, looking ahead, pretty almost everybody who might go bankrupt has gone bankrupt.
Massive Bitcoin sales are occurring
Hayes clarifies his position by saying that since BTC serves as the reserve asset of crypto and is the most pristine asset and the most liquid, centralized lending companies (CELs) frequently call in loans before selling them when they are having financial difficulties.
“When you check at the balance sheet of any one of these heroes, there isn’t any Bitcoin on it because, what did they do, they sold the Bitcoin while they were going bankrupt or during the wave after they went bankrupt,”
In a blog post published on December 10, Hayes made a similar case, stating that massive physical sales of bitcoin are still occurring on exchanges as a result of the “credit crisis,” with trading businesses and CELs both seeking to avoid insolvency and liquidating their holdings.
According to him, because of this, Bitcoin prices plummet just before CELs declare bankruptcy as that’s the major maneuver. Arthur, despite being unable to demonstrate that every Bitcoin held by these failing institutions was sold throughout the various crashes, claims it does appear that they made every effort to sell the most liquid cryptocurrency collateral they could just before they fell.
Will crypto recover soon?
The crypto winter has arrived. Around 58% of the value of Bitcoin, whose mining activities have also been deteriorating, was lost in the second quarter of 2022, and the market for all cryptocurrencies lost about $1.2 trillion. Regulators are closely monitoring the situation, and there has been an increase in cryptocurrency regulation worldwide, particularly in the US, as a result of large losses suffered by institutional and private investors.
Cryptocurrency will survive the winter despite the sharp declines in values and exchange closures, and regulation should provide much-needed trust in both new and old players, which can only be beneficial. Of course, when markets decline, long-term investors have the opportunity to purchase, which is a tactic better suited to established participants in traditional financial markets.
