Arthur Hayes Predicts a Major Crypto Market Sell-Off Tied to Donald Trump's Presidential Inauguration on Jan. 20, 2025

Arthur Hayes, the co-founder of BitMEX, predicts a major crypto market sell-off tied to Donald Trump's presidential inauguration on Jan. 20, 2025

Arthur Hayes, the co-founder of BitMEX, has predicted a major sell-off in the crypto markets, which he believes will be triggered by Donald Trump's presidential inauguration on Jan. 20, 2025. In his recent blog post, titled “Trump Truth,” Hayes expressed concerns about the disparity between investor expectations and the actual timeline for implementing policy changes.

Hayes cautioned that Trump's administration will need time to enact significant crypto policies. “The market believes that Trump and his people can immediately achieve economic and political miracles,” Hayes wrote in the blog post, published on CoinChapter. He predicted that a likely correction in cryptocurrency prices will follow as the market realizes the slower pace of change.

Hayes explained that while there is optimism surrounding Trump's presidency, implementing substantial crypto policies will face delays. He predicted that this mismatch between expectations and reality will lead to a sharp sell-off.

“The market will instantly wake up to the reality that Trump has, at best, one year to enact any policy changes on or around January 20th. This realization will lead to a vicious sell-off in crypto markets and other Trump 2.0 equity trades,” Hayes elaborated.

According to Hayes, this sell-off will precede a rebound in cryptocurrencies, which he expects to enter a recovery phase later in 2025.

Hayes also revealed his investment fund Maelstrom's strategy for navigating potential market turbulence. The fund plans to sell some positions before Trump's inauguration, aiming to repurchase them at lower prices during 2025's first half.

“Maelstrom will be lightening up on certain positions in advance, hoping to rebuy some core positions at lower prices sometime in the first half of 2025,” Hayes noted in the blog post.

He acknowledged that the strategy carries risks but emphasized that the fund is prepared for various outcomes. “We are committed to admitting defeat if the bull market steamrolls through Jan. 20, licking our wounds, and getting back on the bull […] I will be buying dips and rips,” Hayes said.

Hayes urged caution as Bitcoin surges past $100K after Trump's victory

Since Trump's victory in November 2024, Bitcoin has surged past $100,000 for the first time in early December. Many analysts connected this growth to expectations of favorable crypto policies under Trump.

However, Hayes has been urging caution, contrasting bullish predictions from firms like Matrixport, which projected a strong start for Bitcoin in 2025. Matrixport suggested that investors might regret not accumulating more BTC at current prices.

MicroStrategy rumored to pause BTC purchases

On the other hand, rumors reported by Protos suggested that MicroStrategy might enter a blackout period in January 2025. This would halt the company's issuance of shares or convertible bonds used to purchase more Bitcoin, potentially impacting the market.