Bitcoin (BTC) Price Plunges 6.5% as Arthur Hayes Opens Short Position, Targets Sub-$50K

The price of Bitcoin experienced significant turbulence on Friday, plunging from $57,000 to just below $53,000 in a matter of hours.

Bitcoin’s price experienced a wild ride on Friday, dropping from $57,000 to just below $53,000 in a matter of hours. This rapid decline occurred as the U.S. August jobs report hit the markets, initially appearing to be a positive trigger. The report showed a slight drop in unemployment rates, which briefly caused Bitcoin to rise by $1,500 to hit $57,000.

However, the optimism was quickly snuffed out as bears took control and drove the price down by over $4,000, pushing the cryptocurrency to a monthly low of under $53,000. Prominent BitMEX co-founder Arthur Hayes used this opportunity to open a short position, anticipating a further drop below $50,000 over the weekend.

Given Bitcoin’s erratic price movements, Hayes’ move was hardly surprising. But what’s interesting is that he closed his short position with a modest 3% profit, suggesting that he anticipates Bitcoin’s price may rebound soon.

Hayes mentioned an upcoming speech by U.S. Treasury Secretary Janet Yellen as a potential factor that could drive Bitcoin up. His decision to close his short position now indicates that he believes the market sentiment could shift, especially if Yellen’s speech has a significant impact on the economic outlook, monetary policy, or inflation.

Considering Bitcoin’s history of reacting strongly to macroeconomic events, Hayes opted to take profits early rather than risk being caught off guard by a sudden price surge.

Hayes has a long history of making bold statements about Bitcoin. Back in May, he expressed optimism that Bitcoin had reached a local bottom and would see gradual growth. While that prediction initially seemed accurate, the market encountered setbacks, including large-scale sell-offs by the German government and repayments from the Mt.Gox creditors.

Hayes’ Maelstrom Fund also announced a new Bitcoin grant program in July, aiming to support the development of Bitcoin’s technical infrastructure. The initiative showcases Hayes’ enduring belief in Bitcoin, even amidst short-term volatility.

At the time of writing, Bitcoin is trading at around $54,500, down 6.5% over the past week. According to data from CoinMarketCap, it currently boasts a market capitalization of $1.07 trillion.

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