The recent crash in the crypto markets took everyone by surprise, especially bitcoin. The value of many coins decreased very rapidly and very rapidly. Even the number one crypto bitcoin took a big hit when investors continued to sell out in panic. While many are hoping for a recovery, the storm is still growing. Also, many speculations are being made in the market as investors are confused.
Related Reading | Bitcoin Exchange Outflows Show Investors Are Starting to Deposit
With all the chaos, it should come as no surprise that the BitMEX co-founder predicts lower levels for both Bitcoin and Ethereum. According to Hayes, Bitcoin will rest at $25,000-$27000, while Ethereum will remain at $1700-$1800. This is a far cry from the business of both cryptos a few months ago.
On his reasons for making the prediction, Hayes pointed out that the recent sale of 80,000 BTC by Terra has fueled the bitcoin selling frenzy.
Another reason for this set bottom is that BTC is lagging while the stock is recovering. Last week, while Wall Street saw some positives, bitcoin fell instead to $29,000+ from May 29th to May 30th. On May 31st and June 1st, the price rose to $31,000 but is now fluctuating between $29k – $30k. ,
The crypto market started a downward trend when the Federal Reserve announced an increase in taxes. While some investors were still undecided about whether to sell or not, the market took a turn for the worse once the tax took effect.
The incident triggered panic selling, and many investors lost their investments. For example, bitcoin that reached the $40K resistance has been on a downward spiral and has since lost at least 9.40%. Apart from the fall in crypto prices, the global cryptocurrency market has also taken a huge hit.
Is There Any Hope for a Bitcoin and Ethereum Recovery?
According to Hayes, no one can predict a recovery in the near future. The rate hike by the Federal Reserve was meant to help in the fight against inflation. Unfortunately, these conditions are still prevalent, and the rates are still so. In such a situation, the market is still not ready to budge.
Another reason for the decline that spiraled out of control was short-term crypto investors. This group does not believe in waiting till the profitability returns.
Related Reading | Bitcoin Potentially Above $31,000, Bull Rally Or Trap?
They are willing to sell at a lower loss than to keep their assets uncertain for a future rally. With that said, Hayes believes there may be a recovery afterward. But if this happens, many sellers have to exit their positions and grab some value.
As for the expected timing of the rally, Hayes indicated that this could happen if short-termers sell their holdings. Therefore, he advises all investors to be patient and still hope that Ethereum can still reach the forecast of $10,000 by the end of the year.
Featured image from Pixabay, chart from TradingView.com