Crypto May See 'Harrowing Dump' Around Trump’s Inauguration, Warns Arthur Hayes

Outstanding crypto market commentator and former BitMEX CEO Arthur Hayes predicts a “harrowing dump” within the digital assets market around President-elect Donald Trump’s inauguration. Nonetheless, Hayes adds that the anticipated market crash will likely be followed by a robust bullish trend reversal.

Hayes Warns Against Overblown Expectations From Trump

Renowned crypto market analyst Hayes shared a latest blog post outlining his views on the crypto market’s trajectory for the approaching yr. Based on Hayes, the disconnect between the crypto market’s high expectations for Trump’s incoming administration and the political reality will likely spook investors, triggering a big market sell-off.

Hayes points to the market’s unrealistic expectations from Trump, saying that it’s “almost inconceivable for Trump to appease his base sufficiently to forestall the Democrats from retaking each legislative bodies in 2026.” Consequently, Trump can have, at best, one yr to enact any policy changes.

The crypto entrepreneur warned that the market’s realization of those limitations will trigger a “vicious sell-off” in digital assets. He revealed that his investment fund, Maelstrom, plans to book profits ahead of the anticipated sell-off and re-enter the market at lower prices in the course of the first half of 2025. Nonetheless, Hayes noted that he’s open to “admitting defeat” if no market correction occurs by January 20.

Trump’s victory within the US presidential election has sparked fresh hope within the crypto market, leading to BTC rising past $100,000 price level for the primary time ever. On the time of writing, the full crypto market cap stands at $3.81 trillion.

Total crypto market cap sits at $3.81 trillion | Source: CoinGecko

Trump’s victory has also fuelled speculation in regards to the creation of a possible national strategic Bitcoin reserve, a move that might spur competitive sovereign purchases by other nations. Nonetheless, Hayes doesn’t expect such a reserve to materialize anytime soon. He explained:

While I don’t imagine the US government will purchase Bitcoin, it doesn’t affect my positive price outlook. At the tip of the day, a gold devaluation creates dollars which must discover a home in real goods/services and financial assets.

Contrasting Projections For BTC Price Motion

While Hayes foresees an impending crypto market dump in early 2025, crypto financial services firm Matrixport predicts otherwise. Based on a recent X post, the firm expects a “strong start” for BTC going into 2025.

Similarly, Standard Chartered bank estimates that BTC may climb as much as $200,000 by 2025 as more institutions proceed to build up the highest digital asset. A recent report by crypto exchange Bitfinex also predicts further upside potential in BTC after its consolidation across the $100,000 price level.

Much more ambitious price targets were shared by Bitwise’s Matt Hougan, who said that purchasing BTC before it reaches $500,000 would still be considered “early.” At press time, BTC trades at $104,002, down 2.8% up to now 24 hours.