The decline in Bitcoin over the last 24 hours continues. While BTC fell below $89,000, the decline in altcoins is also deepening.
BitMEX co-founder Arthur Hayes, who has made a name for himself with his predictions and posts, claimed that Bitcoin could fall to $70,000.
Hayes said that the expectation of a decline in Bitcoin is based on the increased selling of large hedge funds.
Hayes said that large hedge funds that own ETFs have started to close their positions, adding that this situation has created more selling pressure on Bitcoin.
Arthur Hayes noted that many IBIT holders are hedge funds, and they earn higher returns on short-term U.S. Treasury bonds by going long on ETFs and short on CME futures.
According to the famous name, if the difference between ETF prices and futures narrows along with a decrease in the BTC price, these funds will sell their IBITs and buy back CME futures.
“Bitcoin bear market is coming, Bitcoin could fall to $70,000.
Most of BlackRock’s Bitcoin spot ETF holders are hedge funds that go long the ETF, short CME futures to get higher returns than where they fund short-term U.S. Treasury bonds.
Hedge funds that hold IBIT are shorting Bitcoin futures in the futures market while simultaneously buying the ETF because they can profit from this strategy.
However, when the price difference between Bitcoin ETFs and futures narrows, hedge funds will sell their ETFs and buy back CME futures.
If funds continue to take profits through position liquidations, Bitcoin could fall to $70,000.”
Bitcoin continues to trade at $88,500 at the time of writing.
#Bitcoin goblin town incoming:
Lots of $IBIT holders are hedge funds that went long ETF short CME future to earn a yield greater than where they fund, short term US treasuries.If that basis drops as $BTC falls, then these funds will sell $IBIT and buy back CME futures.
These… pic.twitter.com/3PskTxrBPR
— Arthur Hayes (@CryptoHayes) February 24, 2025
*This is not investment advice.
