Bitcoin (BTC) Price Unlikely to revisit the $77,000 Price Level Anytime Soon: Arthur Hayes

Bitcoin is unlikely to revisit the $77,000 price level anytime soon after the Fed signaled a slowdown in quantitative tightening (QT), says BitMEX co-founder Arthur Hayes.

Benzinga - BitMEX co-founder Arthur Hayes said that Bitcoin (BTC) is unlikely to revisit the $77,000 price level anytime soon after the Federal Reserve signaled a slowdown in quantitative tightening (QT).

“Was BTC $77k the bottom, prob,” Hayes said in a March 20 X post.

After noting that the QT is “basically over,” Hayes was referring to the Fed's March 19 announcement that it will be slowing down its securities sell-off.

The central bank is planning to reduce the monthly Treasury cap from $25 billion to $5 billion and the agency mortgage-backed securities purchase to zero from $12 billion starting April.

This comes as the crypto market has been reacting to the macroeconomic climate, especially in the wake of the last two interest rate decisions.

According to CoinMarketCap data, Bitcoin dipped to nearly $77,000 on March 10 for the first time since November.

Bitcoin is 3.53% over the past seven days. Image Credit: Benzinga

This could help to ease some of the liquidity pressures and provide support for risk assets like Bitcoin, as QT involves central banks selling assets to reduce the money supply and possibly raise interest rates.

“The next thing we need to get bulled up for realz is either SLR exemption and or a restart of QE,” Hayes added.

The Supplementary Leverage Ratio (SLR) exemption was a temporary rule during the COVID-19 pandemic that allowed banks to exclude U.S. Treasury securities from their SLR calculations.

It was enacted in March 2020 and later extended several times before expiring on March 27.

Meanwhile, quantitative easing (QE) is a monetary policy that aims to stimulate the economy and encourage more spending. It usually involves a central bank injecting money into the financial system by buying up government bonds or other securities.

Another crypto analyst, Real Vision's chief crypto strategist Jamie Coutts, also expressed a similar sentiment.

"QT is effectively dead. Treasury volatility has abated massively following the USD sell-off and we're now seeing the bulk of the internals improve again: e.g., preferentials are out of the dumps and high yield is starting to stabilize," Coutts said in a March 19 X post.

He added that this is a "huge plus" for boosting liquidity and ultimately helping to support the market.

Other optimists included Axie Infinity (AXS) co-founder Jeff "JiHo" Zirlin, who said the Fed slowdown is "great for both crypto and equity markets."

"The Fed has significant leeway to loosen up, providing more support for businesses + markets."

Bitcoin venture capitalist Mark Moss also pointed out that with QT coming to an end, "the dam is going to break."