Hayes Predicts $70K Bitcoin Crash if Trump's Budget Plans Falter

Crypto industry veteran Arthur Hayes says Bitcoin's near-term price trajectory depends heavily on U.S. political developments.

Hayes, founder of BitMEX, stated that investors should 'chill out, retrace and wait' for now, as the market is influenced by Trump's budget plans.

If Trump fails to pass his budget, which would increase spending and raise the debt ceiling, Hayes predicts a price drop to $70,000-$75,000. This scenario would test the strength of Trump's hold on the Republican party.

Hayes warned that many hedge funds invested in BlackRock's iShares spot Bitcoin ETF (IBIT) through short positions on CME futures may exit their positions if Bitcoin continues its downward trend. These funds adopted a yield-generating strategy and would unwind their positions when the basis drops below UST yields.