Crypto Now Braced For A ‘Powder Keg’ That Could Play Havoc With The Price Of Bitcoin And Ethereum

BitcoinBTC, ethereum and crypto prices have been trading sideways for months (though the CEO of one major crpyto company thinks that could be about to change).

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The bitcoin price has dropped back from year-to-date highs of just over $30,000 per bitcoin, with the ethereum price falling along with it—even as excitement over a possible end to Ripple’s long-running legal battle has helped XRP break out.

Now, after JPMorgan analysts issued a serious $1.1 trillion warning, the former chief executive of bitcoin and crypto exchange Bitmex, Arthur Hayes has predicted a crypto market “powder keg” could go off as soon as this year.

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House and congressional Republicans has ended a political stand-off that risked triggering an unprecedented debt default but could see “powder keg” ignite the bitcoin, etheruem and crypto market price.

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“You’re basically putting this powder keg together of a situation that’s going to be exploding in [the third and fourth quarter] of this year, and I think ultimately it will be good for bitcoin,” Hayes, who now runs a family office called Maelstrom, told the What Bitcoin Did podcast. “It will be quite volatile on the upside and the downside.”

Bitcoin, ethereum and other major cryptocurrencies have cheered a U.S. debt ceiling deal, despite president Joe Biden’s earlier stark crypto warning.

Hayes, who last year was sentenced to two years of probation after pleading guilty to charges he failed to implement an anti-money laundering (AML) program at Bitmex, pointed to this year’s banking crisis and expectations the U.S. government will issue just over $1 trillion in new Treasury bills in coming months, potentially sucking hundreds of billions of dollars from the market.

few years, pulling the ethereum price with it.

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“I don’t think we get up to $70,000 this year, I think next year is when we cross that barrier, then we get the blow off top [2025], [2026] and then it’s Armageddon,” Hayes said. “It doesn’t have to be too straightforward, we just have this situation, we have this tinderbox of too much money, no trust and people trying to eke out a living for themselves.”

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I am a journalist with significant experience covering technology, finance, economics, and business around the world. As the founding editor of Verdict.co.uk I reported on how technology is changing business, political trends, and the latest culture and lifestyle. I have covered the rise of bitcoin and cryptocurrency since 2012 and have charted its emergence as a niche technology into the greatest threat to the established financial system the world has ever seen and the most important new technology since the internet itself. I have worked and written for CityAM, the Financial Times, and the New Statesman, amongst others. Follow me on Twitter @billybambrough or email me on billyATbillybambrough.com.
Disclosure: I occasionally hold some small amount of bitcoin and other cryptocurrencies.