Arthur Hayes cautions that Bitcoin could plummet below $100,000 after NFP data
Arthur Hayes, the former head of BitMEX, has raised concerns about a potential decline in Bitcoin’s value following disappointing data on U.S. Non-Farm Payrolls (NFP), despite maintaining an optimistic outlook on the digital asset’s long-term future.
The release of the NFP report sparked a significant sell-off in both traditional financial markets and the cryptocurrency sector. Hayes pointed out that risk assets, including Bitcoin, experienced heightened volatility as traders recalibrated their expectations regarding the Federal Reserve’s monetary policy.
In the aftermath of the NFP report, more than $1.1 trillion evaporated from the U.S. stock market, and approximately $172 million in bitcoin long positions were liquidated across various exchanges in a single day. This resulted in Bitcoin’s price dropping below $114,000 in early August, a decline from its peak of over $120,000 in July.
Bitcoin’s performance during this downturn demonstrated its resilience compared to other cryptocurrencies. Noted critic Peter Schiff took the opportunity to question Bitcoin’s status as a safe-haven asset by contrasting its behavior with that of traditional safe-havens:
“A day like today serves as a reminder that Bitcoin cannot be viewed as digital gold. In response to negative economic news, the price of gold and the Japanese yen surged by 2.2% and the euro by 1.5%. However, the NASDAQ moved in the opposite direction, dropping by 2.2%. Bitcoin followed the trend of high-risk assets, declining by 3% rather than correlating with the performance of safe-haven assets.”
Despite the immediate market turmoil, Arthur Hayes reiterated his optimistic long-term perspective on Bitcoin. While short-term caution is warranted based on the recent NFP report, Hayes remains bullish on the future of the cryptocurrency, suggesting that the digital asset has the potential for significant growth in the long run.
In conclusion, the aftermath of the NFP report illustrates the impact of macroeconomic indicators on the cryptocurrency market, with Bitcoin exhibiting both volatility and resilience in response to changing market conditions. As investors navigate these fluctuations, it is essential to consider the broader economic context and the potential long-term growth opportunities that digital assets like Bitcoin may offer.
