Arthur Hayes predicts BTC halving will ignite a frenzied sell-off of crypto assets.

BitMEX co-founder Arthur Hayes predicts that the upcoming Bitcoin halving, combined with measures taken by the Federal Reserve and Treasury, will result in a significant drop in the crypto market for several weeks. In a blog post on April 8, Hayes expressed his belief that while the halving may ultimately boost prices in the medium term, there could be a negative impact on prices before and after the event. He also outlined his theory on how the policies of the Federal Reserve and Treasury will affect the markets. Hayes acknowledged that the market could defy his bearish outlook and continue to rise, but expressed his long-term confidence in crypto. He noted that the second half of April will be a precarious period for risky assets due to U.S. tax payments and the tightening of the money supply through Quantitative Tightening (QT) by the Fed. Hayes also mentioned that the Treasury’s General Account (TGA) has yet to be utilized. He expects that after May 1, the Fed will reduce the pace of money supply tightening, and the Treasury will inject approximately $1 trillion of liquidity into the system, which will stimulate the markets. As a result of these factors, Hayes has decided to abstain from trading until May. Bitcoin has experienced a 61% increase in value year-to-date, trading at $71,170 as of now. The Crypto Fear & Greed Index has also shown a climb in market sentiment, reaching “Extreme Greed” with a score of 80 on April 9. Hayes believes that if his liquidity scenarios prove to be accurate, he will have more confidence to invest in various crypto assets. He is willing to miss out on a few percentage points of gains in order to avoid losses for his portfolio and lifestyle.