Crypto News Today: Arthur Hayes Warns of Major Crypto Correction After March 2025 Peak

Former BitMEX CEO Arthur Hayes Arthur Hayes   Arthur Hayes is an investor and entrepreneur from the United States. He is the previous CEO of BitMEX, one of the top cryptocurrency derivatives exchanges globally. In 2014, he co-established BitMEX, facilitating cryptocurrency trading through leveraged Bitcoin futures.   He is often seen sharing his insights and views on the Bitcoin market. He also backs crypto-related projects and helps them gain momentum with his advice on the market.   Quick Facts   Full name Arthur Hayes Birth 1985, Detroit, Michigan Nationality American Education Economics & Finance from the Wharton School of Business  Marital status Married Net worth Estimated $500-700 million   Hayes previously worked at Deutsche Bank and Citigroup. While working at these fintech firms, Arthur concentrated on establishing crypto derivatives as a common standard. In 2021, he encountered legal problems concerning BitMEX's compliance. Nevertheless, he settled the matter through legal means.   Arthur Hayes - Timeline and Events   2016 – Launched the XBTUSD perpetual swap, revolutionizing crypto trading. 2018 – BitMEX became one of the largest Bitcoin trading platforms. 2020 – Faced legal scrutiny but remained a key industry figure. 2021 – Settled U.S. legal issues and stepped down as BitMEX CEO. 2022 – Focused on crypto investments and writing industry insights. 2023 – Advocated for Bitcoin adoption and decentralized finance (DeFi). 2024 – Continued shaping the digital asset space through investment and research.   Arthur has collaborated with various blockchain experts and engaged with innovative startups for the growth of crypto and Web3 innovations. He continues to be an influential voice in the crypto space and shares his perspectives on Bitcoin, DeFi, and blockchain regulations.   Useful Links to Connect With Arthur Hayes   Platform Link X (formerly Twitter) https://twitter.com/CryptoHayes LinkedIn https://www.linkedin.com/in/arthur-hayes BitMEX Website https://www.bitmex.com Personal Blog https://cryptohayes.substack.com EntrepreneurInvestorChief Executive OfficerTrader has shared his bold prediction for the cryptocurrency market, stating that it will likely reach its peak by mid-March 2025, before experiencing a severe correction. Hayes explained his reasoning and wrote,

“My prediction is that the market peaks in mid to late March, so this equates to a removal of $180 billion worth of liquidity due to QT from January to March.”

The Liquidity Factor

Hayes points to the Federal Reserve’s quantitative tightening (QT) policy, which involves reducing the size of its balance sheet by $60 billion per month. This tightening has resulted in the removal of significant liquidity from the financial markets. Hayes predicts that by mid-March 2025, this policy will have drained $180 billion from the market, contributing to the peak of the crypto market.

The downturn in 2022, according to Hayes, was a result of similar liquidity issues. When U.S. Treasury Secretary Janet Yellen issued shorter-dated coupon bonds in place of longer-dated ones, it drained more than $2 trillion from the Fed’s reverse repo facility (RRP). This reduced liquidity triggered declines in both crypto and stock markets, particularly affecting large U.S. tech stocks.

Short-Term Bullish Signal for Bitcoin

Despite the overall market correction expected in the second quarter of 2025, Hayes believes there’s a short-term bullish signal for Bitcoin. He explained that the U.S. Treasury would be spending down its general account (TGA) at the Federal Reserve, which would inject liquidity into the market, benefiting Bitcoin’s price in the short term. Hayes also predicts that the reverse repo facility (RRP) will see its balance drop from $1.237 trillion to zero by the end of Q1 2025, further boosting liquidity.

This surge in liquidity will likely come from money market funds (MMFs) withdrawing funds from the RRP to purchase higher-yielding treasury bills. This could add up to $237 billion into the market during the first quarter of 2025, which Hayes believes will fuel a final crypto market rally.

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Potential Challenges Ahead

However, Hayes also expects a bearish factor that could affect the market in April: tax deadlines. With April being a significant tax month in the U.S., Hayes warns that these deadlines could pose a challenge for the crypto market, potentially contributing to a sharp correction after the March peak.

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