The crypto market is engulfed in fear and uncertainty, which deepens with cautious investor moves and fosters expectations of increased volatility. BitMEX founder Arthur Hayes suggests that current conditions resemble the bullish sentiment of 2022. Hayes believes that global economic challenges and strict monetary policies are paving the way for central banks to resort to printing money under pressure, potentially leading to a surge in cryptocurrency values.
Atmosphere of Fear and Uncertainty
The uncertainty gripping the crypto market today is reminiscent of the energy of late 2022. Hayes points out that the bullish trend during that period was shaped by buying opportunities fueled by panic. Currently, investors are concerned that prices will fluctuate more intensely after each macro-economic report, driven by inflation data and geopolitical tensions. This apprehension may result in panic selling, followed by sharp recovery buying. Analysts predict that these fluctuations will severely test investors’ psychological resilience.
Furthermore, Hayes suggests that these economic challenges might compel central banks to print additional money. The United States Federal Reserve’s previous balance sheet expansion might be a choice again to meet liquidity demands. Investors foresee this process as a significant relief for cryptocurrency prices. However, this scenario’s realization depends on economic indicators and policy stance.
The Role of Bitcoin Dominance
Hayes argues that Bitcoin 
$106,943 dominance might rise to 70%, leading to transformations within investor portfolios. As Bitcoin’s value approaches around 150,000 USD, risk appetite could increase, accelerating a shift towards alternative assets. While technical indicators support Bitcoin’s long-term trend line, short-term volatility seems inevitable. This scenario might ignite rallies in altcoins. Market participants anticipate some minor profit-taking following the increase in dominance.
A shift towards alternative assets could revitalize a new altcoin season. Historically, after a rise in Bitcoin dominance, altcoins have recorded gains of up to 100%. According to Hayes, investors might initially profit from Bitcoin and then distribute the liquidity into more speculative cryptocurrencies, reshaping the crypto market and sparking interest in various token projects. This process will inevitably vary according to investors’ risk tolerance.
