bitcoin After the recent rise in the price, experts continue to discuss the rally. While there are many different interpretations on the subject, eyes are also on the Federal Reserve’s monetary policy decision. While the course of monetary policy is a big question mark, some names continue to reiterate that the pressure will ease.
Bitcoin has managed to increase over 30% since the beginning of 2023, triggering volatility in the cryptocurrency market. The reason for this rally is the lower-than-expected US CPI data, which is a possible signal of a slowdown in the rise in interest rates.
However, Arthur Hayes argues that if the US Federal Reserve does not soften its monetary policies, BTC and cryptocurrency warned that the market may experience a decline.
Bitcoin Could Drop To $15,000!
In a recent commentary on US macroeconomic policy, Arthur Hayes claimed that a “disastrous global financial crisis” could be poised to sink BTC and the crypto market. He underlined that the current volatility in Bitcoin should not be seen as the beginning of a new bull run.
The latest figures from the US Bureau of Labor Statistics show that inflation peaked at around 10% in mid-2022 and is now declining further towards the desired 2% levels.
Experts believe this trend could signal a policy shift away from Quantitative Tightening (QT) in response to Federal Reserve Chairman Jerome Powell’s risk of recession. As a matter of fact, with the pressure of some members, the rates can be increased with the target of increasing to over 5% in 2023.
Correlation Between BTC and USD Liquidity
Although many respondents believe that Bitcoin is independent of central banks and financial institutions, it is possible to observe that it is highly correlated with USD liquidity.
Recent market performance reflects investors’ anticipation of a shift in Federal Reserve policy. Some analysts predict that if the Federal Reserve makes a policy adjustment, Bitcoin’s current rise could continue and a “secular bull market” could emerge.