Former BitMEX CEO Arthur Hayes Believes Ethereum Price Could Increase After Merge Upgrade
Former CEO of BitMEX cryptocurrency exchange Arthur Hayes Claims Current Ethereum Futures Term Structure Could Point to a Significant Rally after the merger,
The backwardation describes a term structure where a futures contract trades lower than the cryptocurrency’s spot price.
While this can be seen as a bearish take on the price of Ethereum, Hayes believes that Ethereum traders are hedging Ethereum exposure at the end of the much-anticipated merge event. According to the controversial entrepreneur, this adds additional selling pressure to the Ethereum spot market.
After years of frustrating delays, some market participants believe the upgrade may still be a mess because of how big and technically challenging it is.At the same time, Hayes believes that hedgers will have to cover their shorts if Ethereum’s transition to proof-of-stake is successful, with speculators also likely to buy into the “triple halving” narrative. Market makers will have to reverse their position by going long spot and shorting Ethereum futures.
Such a scenario could potentially drive the price of Ether up sharply.
As reported by U.Today, Ethereum developers recently confirmed that the merge is now on track and the merge upgrade is due on September 15th.
Last week, Hayes predicted that Ethereum price would return to the $3,500 level after a successful merge event. In fact, he believes the second-largest cryptocurrency could reach $5,000 if the Fed pivots.