Arthur Hayes, the CEO of cryptocurrency derivatives exchange BitMEX, has recently stated the cryptocurrency bear market could last another year and a half, based on his experience from the bear market BTC went through years ago.
Speaking to Yahoo Finance UK, Hayes noted that he entered the bitcoin world in 2013, when its price was at around $250, and quickly surged to $1,300. Then, in 2014 and 2015, after the collapse of the then dominant cryptocurrency exchange Mt Gox, he noted it “was sort of the nuclear bear market.”
Per his words, both the price and volume crashed, making it “very, very difficult to make money.” As for the current bear market, he said:
My view is the volatility environment that exists right now could persist for another 12 to 18 months, the flatness.
The cryptocurrency space has been in a bear market since late last year. The price of bitcoin, the flagship cryptocurrency, dropped from a near $20,000 all-time high to about $6,300 at press time.
Hayes, a former Deutsche Bank and Citi trader, was speaking to Yahoo Finance UK at an event in London, organized by the Spectator Magazine. He co-founded BitMEX in 2014, and revealed he believes current market conditions can get even worse, as trading volumes could fall further.
While leading cryptocurrency exchanges like Binance and Huobi now rarely trade over $1 billion on a daily basis – a figure that was common earlier this year – as the volatility drops, BitMEX is still seeing large volumes.
In fact, it traded a record 1 million BTC in 24 hours earlier this year, at the time worth about $8 billion. Per Hayes, the derivatives exchange is “well positioned to weather the low volatility.” Addressing reports that revealed crypto exchanges have been laying off employees during the market’s downturn, he added:
There are some reports of other OTC dealers and exchanges letting go of employees because obviously volumes have fallen and they hired aggressively. Our expansion plans have not changed, we continue to hire across the whole organisation and we have the balance sheet resources to continue that activity
Bullish on Bitcoin
While Hayes believes the bear market is set to last for a while, he has in the past claimed bitcoin will reach $50,000. Yahoo Finance also spoke to other analysts who are bullish on cryptocurrencies like bitcoin.
Will Warren, the co-founder of decentralized crypto exchange protocol 0x, noted he’s seen a number of cycles where “a large number of people start to get interested in the technology and it kind of winds up and then winds down again.” He added:
The market is blowing off some steam right now. I think the market is probably going through some healthy consolidation but I do believe the long-term trend will be greater adoption of bitcoin and similar technologies
Mati Greenspan, a senior analyst at eToro, noted that in 2016 the gains started coming gradually before snowballing, and that now “that awareness and education have skyrocketed,” things might “happen a lot quicker next time.”