The post Crypto Warning: Arthur Hayes Foresees Short-Term Market Crash Linked To Interest Rate Cuts appeared on BitcoinEthereumNews.com.

Former BitMEX CEO Arthur Hayes thinks the upcoming interest rate cuts by the US Federal Reserve (Fed) could ignite a short-term crypto market crash. Fed Is Doing A Colossal Mistake, Hayes Says Delivering a presentation titled ‘Thoughts on Macroeconomic Current Events’, at the Token2049 event in Singapore on September 18, Hayes indicated he is not too excited about the Fed’s decision to slash interest rates. Hayes said: I think the Fed is making a colossal mistake cutting rates at a time when the US government is printing and spending as much money as they ever have at peace time. While I think a lot of people are looking forward to a rate cut, meaning that they think the stock market and other things are going to pump up the jam, I think the markets are going to collapse a few days after the Fed’s rates. While delivering the presentation, the serial digital assets entrepreneur pointed to a chart showing that almost 50% of the central banks in the world today are in rate-cutting mode. Hayes opined that the Fed may cut rates by 50 or 75 basis points (bps), which might narrow the interest rate differential between the US dollar (USD) and the Japanese yen (JPY) and culminate in a wider market drawdown. He noted: We saw what happened a few weeks ago when the yen went from 162 to about 142, over about 14 days of trading that caused almost a mini financial collapse,” the former BitMEX exec said, adding: “We’re going to see a revisit of that financial stress. To add merit to his prediction, Hayes juxtaposed investing in digital currencies with holding 5%-yielding Treasury Bills (T-bills). He said that investors would much rather put their money into government-backed T-bills during market turmoil than riskier decentralized finance (DeFi)…

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Filed under: News - @ September 19, 2024 10:23 am