Arthur Hayes Predicts Bitcoin Drop Below $50K, Takes Short Position

Arthur Hayes, co-founder and former CEO of BitMEX, shared on Friday that he expects Bitcoin to fall below $50,000 over the weekend, revealing that he has placed a short position in anticipation of the decline. “Pray for my soul, for I am a degen,” Hayes remarked in an X post, showcasing his risky bet.

Bitcoin was trading at $56,731 on Friday, down 0.7%, and has dropped nearly 5% over the past week. Bitfinex analysts have warned that the anticipated Federal Reserve interest rate cut could further pressure Bitcoin’s price. While a 25 basis point cut could potentially increase liquidity and help Bitcoin in the long term, a larger cut might have a short-term negative impact.

If Bitcoin experiences a 20% drop, it could fall to $46,000, a level not seen since February. This aligns with some analysts’ views, like 10x Research, which considers the low $40,000s an ideal entry point for the next bull market. Other analysts, such as Moustache, suggest that the market could find support around $57,000, citing historical fractal patterns.

Short Selling Bitcoin: How It Works Investors like Hayes can profit from falling Bitcoin prices through short selling. This strategy involves borrowing Bitcoin, selling it at a higher price, and then repurchasing it at a lower price to return to the lender, making a profit from the price drop. Shorting is a common tactic in bearish markets, allowing investors to hedge against downturns or profit from expected declines.