Key Highlights

• Arthur Hayes says that the global financial markets are assured for a further downturn having a drastic impact on Bitcoin.
• Tone Vays, a former Wall Street trader, however argued that the current economic environment is ideal for Bitcoin to thrive as a hedging asset.

Arthur Hayes, co-founder, and CEO of BitMEX believes that $3,000 Bitcoin is realistic when current economic conditions are considered. Tone Vays, on the other hand, believes that BTC will show its colors as a safe-haven. With these two complete varying opinions, the question of who is right arises

Possibilities of a Further Decline

In a blog post dated April 9, 2020, Arthur Hayes, CEO at BitMEX, explained that the global financial markets are assured for a further downturn. With the ongoing pandemic, the $2 trillion stimulus package had been passed by the U.S. Senate for the provision of relief from the havoc. Hayes, in this regard added that it might have little to no impact on the stock market.

The S&P 500 is reported to have gotten over by a near 30% from the recent crash which was reported to be the Bitcoin’s biggest price drop. Hayes however, referred to this positive impulse as a dead cat bounce. He says he expects a steeper decline across all major economies, in the crypto markets specifically.

He further added that as violent as the Q1 collapse in asset values had been, almost 100 years of imbalances exist to unwind the ancient regime.

The former Deutsche Bank market-maker was affirmative about Bitcoin retesting the $3,000 price level. This is before it was being forced to make a sharp rebound. Thus ending the year at around $20,000.

As the unemployment rate has risen due to the COVID-19 impact, investors are rushing to safe-haven assets. Also, the financial turmoil might intensify creating the perfect conditions for a deep recession. All these overall will spill over into the crypto industry.

Tone Vays’s Argument on Bitcoin Crash

However, Tone Vays, who is a former Wall Street trader and is a VP at JP Morgan Chase argues. He states his argument that an economic crisis can be more beneficial for Bitcoin as it can thrive as a hedging asset.

According to the analyst, this environment is an ideal instance that makes the flagship cryptocurrency so resilient.

The Crypto Fear and Greed Index continues to sense critical fear amongst the market participants. However, Vays through his argument has stated the importance of being more positive than ever.

Bitcoin’s Focal Point

Based on the Bitcoin’s 1-day chart, it broke out of an ascending triangle it had been developing since the Mar.12 crash. This formation however, is considered to be a continuation pattern that forecasts a 32% target.

Most of the assets tend to return to the breakout point before making it to the trend, after having moved above the horizontal trendline of an ascending triangle. And at current, Bitcoin, the pioneer cryptocurrency shows this kind of behavior.

A further rise in the demand for Bitcoin around the current price levels has a chance to push it up to $9,000 or higher. This target is determined by the measure of the height of the triangle at its thickest point. Also by adding that distance to the breakout point.

Final Outlook

However, if the current level of support provided by the 78.6% Fib fails to hold, the cryptocurrency can drop to the next demand barrier. This barrier can be around $6,100. This happens, if the current level of support that is provided by the 78.6% Fib fails to hold. This price hurdle will then become a key to BTC’s trend.

Bouncing off from it will add hope to investors. Whereas, breaking below it will add confidence to the outlook of Hayes’.

Well, if Bitcoin will come off as a safe-haven asset during the ongoing financial meltdown or as a hurtle with the other markets can only be answered with time.

Umme Haani