- BitMEX CEO Arthur Hayes predicts a further drop in Bitcoin (BTC) price in the range of $2,100 to $3,000.
- Hayes predicts that Bitcoin will rise to $20,000 by the end of the year because of growing demand due to the financial crisis.
BitMEX CEO, Arthur Hayes, discussed the current economic crisis and the changes that the COVID-19 pandemic will cause in the “monetary fiction”. Hayes is known for his accurate predictions and was one of the few who claimed that Bitcoin’s price would crash like it did on March 12.
At that time, BTC’s price plummeted from $7,900 to $3,700. Although Bitcoin managed to recover and has been slowly moving up since then, the drop marked the beginning of a period of high volatility and uncertainty in the global economy.
The demand for Bitcoin will grow during 2020
At the time of publication, Bitcoin’s price trades at $6,902 with a 0.54% loss in the last 24 hours. Although it has had a significant recovery during the last week, BitMEX’s CEO stated that the price could fall again to the range of $2,100 to $3,000. The fall could be caused by a negative performance in traditional markets. Hayes affirms:
Bitcoin will be owned unlevered. Could the price retest $3,000? Absolutely. As the SPX rolls over and tests 2,000 expect all asset classes to puke again. As violent as the Q1 collapse in asset values was, we have almost 100 years of imbalances to unwind the ancien régime. My end of 2020 price target remains $20,000.
Hayes thinsk Bitcoin could rise due to the inefficiency that financial institutions, politicians and governments will have in solving the economic problem with their traditional methods. According to Hayes, current attempts by the Federal Reserve and other banking institutions are inflationary and in times of inflation, investors will seek to own two assets: gold and Bitcoin:
(…)I will reiterate, that is inflationary because more fiat money will chase a flat to declining supply of real goods and labour. There are only two things to own during the transition to whatever the new system is, and that is gold and bitcoin.
On the other hand, data from the research firm Skew outlines that the price of BTC has a 5% chance of reaching $20,000 in 2020. Skew’s measurements and Hayes’ predictions are consistent with statements by Dan Morehead of Pantera Capital. According to Morehead, standard monetary policies will be ineffective in combating the current crisis. This could allow Bitcoin to consolidate as a safe haven asset in times of crisis and reach new highs by the end of the year.