• Arthur Hayes predicts Bitcoin may dip under $50,000 as he takes a short position in the economy. 
  • The Crypto Fear Greed Index hit “extreme fear” as Bitcoin’s value declined, losing $29.7 billion in exchange value.
  • Major cryptocurrencies like Ether and Solana also sustained losses as market withdrawals soared to $94.26 million.

BTC might fall under $50,000, with respect to Arthur Hayes, the previous CEO of BitMEX. On Friday, Hayes revealed he had taken a short wager, betting on a drop in the token’s cost. He expressed his views on X, stating, “Pray for my soul, for I am a degen.” This prediction comes as an economic mood transforms into deep anxiety.

Bitcoin Under Pressure as Fear Grows

The Crypto Fear Greed Index, which tracks market attitudes, tumbled to 22 on September 6. This marks the first time since mid-August that the index has reached “extreme fear,” demonstrating a noticeable slide in shareholder confidence. BTC’s stock  has also been under strain, dropping by 2.7% in the past day to a low of $55,838. The recession caused a $29.7 billion drop in the coin’s trading value. Although BTC slightly recovered to $56,533, the equity remains cautious.

Short Selling Gains Momentum

Short placement has become a technique in this business climate. Traders like Hayes are betting on the coin’s slump by borrowing and selling it now, hoping to repurchase it at a lower price later. This method is useful during bearish conditions and provides a hedge for those holding substantial Bitcoin positions.

✅ The co-founder of Bitfinex has opened a short position on $BTC , aiming for $50k, as he anticipates this price by the weekend. pic.twitter.com/RBeGHclwqe

— Rananjay Singh (@TodayCryptoRj) September 6, 2024

Moreover, short selling is often used by  shareholders who believe BTC is overvalued or expect changes that could impact the economy. Hayes’ actions have brought attention to this technique by showing its possible pitfalls and rewards.

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Ripple Effect on the Crypto Market

Bitcoin’s drop has also impacted the broader crypto sector. Other coins like ETH , Solana, and XRP have also seen declines. Ether fell by 2.23% while Solana and XRP dropped by 2.82% and 2.19%.

These declines triggered widespread liquidations across the trading floor. Data from CoinGlass shows $94.26 million worth of sale transactions occurred in the past day. Most of these were extended contracts, with over $71 million wiped out. BTC longs saw $36.71M in liquidations, while Ethereum stocks accounted for $17.36 million.

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