BitMEX Founder Arthur Hayes And Strategist Peter Schiff Warn That A Crypto Crash Might Follow Bitcoin ETF Approvals

Updated: 05 January 2024

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BitMEX founder Arthur Hayes and Bitcoin bear Peter Schiff have warned crypto bulls that the approval of spot bitcoin ETFs (exchange-traded funds) may be followed by a crypto crash.

Hayes said in a recent blog post that Bitcoin will correct by at least 20% to 30% from March after a rally following the launch of Bticoin ETFs, and said he won’t buy BTC until March.

“The washout could be even more severe if the slate of US-listed spot Bitcoin ETFs has already commenced trading,” he said. “Imagine if the anticipation of hundreds of billions of fiat flowing into these ETFs at a future date propels Bitcoin above $60,000 and close to its 2021 all-time high of $70,000. I could easily see a 30% to 40% correction due to a dollar liquidity rug pull.”

A 40% crash from $70,000 would take Bitcoin back to $42,000, 4% below the $43,775 it was trading at as of 7:15 a.m. EST. Hayes called a 20% to 30% crash ”healthy” after a strong rally but still said ”I cannot buy Bitcoin until these March decision dates have passed.”

Institutional Demand For Spot Bitcoin ETFs ”Might Not Show Up”

Schiff, who is chief economist and global strategist at Euro Pacific Asset Management, told crypto investors in an X post to be careful what they wished for, and said the promise of a BTC ETF approval has been supporting the Bitcoin price for years.

“Once the ETFs are launched and the highly anticipated institutional and other new investor demand does not show up, look out below,” he said on Jan 2.

Be careful what you wish for. The promise of a U.S. listed spot #BitcoinETF has been supporting the #Bitcoin price and speculative demand for years. Once the ETFs are launched and the highly anticipated institutional and other new investor demand does not show up, look out below!

— Peter Schiff (@PeterSchiff) January 2, 2024

Schiff has predicted BTC’s demise for years, and X users were quick to criticize him for his bearish prediction on the platform.

Such BTC bulls reminded him that gold ETFs did not hamper the demand for real gold. They are thus confident that the approval of spot Bitcoin ETFs will add positive momentum to the cryptocurrency market.