Bitcoin Bottom at $77,000 Confirmed, Says Arthur Hayes, Predicting Fed Rate Cuts in April
Bitcoin Price Surge Expected as Fed Prepares for Rate Cuts, Hayes Predicts
Key Highlights:
- Bitcoin jumped 3.5% following the FOMC meeting, with Arthur Hayes expecting Fed rate cuts from April 1.
- Analysts suggest even a 10% increase in liquidity could more than double Bitcoin’s price.
- While Hayes predicts the end of QT (quantitative tightening) by April 1, analyst Benjamin Cowen disagrees, expecting further tightening.
Bitcoin may soon regain upward momentum as former BitMEX CEO Arthur Hayes forecasts Federal Reserve rate cuts starting April 1. After the recent FOMC meeting, the Fed decided to keep interest rates at 4.5%, causing Bitcoin to rally 3.5% alongside altcoins.
Arthur Hayes Predicts Bitcoin Bottom and Fed Policy Shift
Commenting on Bitcoin’s reaction to the FOMC meeting, Arthur Hayes suggested that Bitcoin’s dip to $77,000 could mark its bottom. He anticipates the end of QT (quantitative tightening) by April 1, with potential bullish catalysts such as an exemption to the Supplementary Leverage Ratio (SLR) or the return of quantitative easing (QE).
Hayes also speculated that a correction in the U.S. stock market could pressure Federal Reserve Chair Jerome Powell to adopt policies favoring the Trump administration. Encouraging investors to stay flexible and liquid, Hayes suggested that rate cuts might be politically motivated.
Adding to the speculation, Donald Trump posted on Truth Social:
“The Fed would be MUCH better off CUTTING RATES as U.S. tariffs start to transition (ease!) into the economy. Do the right thing. April 2nd is Liberation Day in America!!!”
Bitcoin’s Recovery and M2 Money Supply Correlation
Following the FOMC meeting, Bitcoin rebounded 3.5%, reaching $87,000. Crypto analyst IncomeSharks noted that Bitcoin has bounced from the supertrend support, but for further gains, it must close above $86,351.
Moreover, Bitcoin’s price action is closely linked to M2 money supply, which has been increasing. Historically, Bitcoin exhibits a power-law leverage factor of 9 in relation to liquidity. A 10% rise in liquidity could potentially double Bitcoin’s price, pushing it towards $90,000 by mid-April. 
At the same time, inflows into spot Bitcoin ETFs have resumed, with BlackRock’s IBIT leading the charge.
Altcoins have also followed Bitcoin’s momentum. Ethereum (ETH), XRP, Solana (SOL), and Dogecoin (DOGE) have gained between 4-10% over the past 24 hours.
Will the Federal Reserve End QT in April?
With the U.S. economy slowing due to trade tensions, some analysts believe the Federal Reserve could reverse its stance on QT. During a press conference, Jerome Powell noted:
“The median participant projects that the appropriate level of the Fed Funds Rate will be 3.9% by year-end and 3.4% next year, unchanged from December.”
However, crypto analyst Benjamin Cowen disagreed with Hayes, asserting that QT is far from over. Cowen emphasized that while QT has slowed, the Fed still reduces its balance sheet by $35 billion per month through mortgage-backed securities. Although the pace has eased from $60 billion to $40 billion per month, the tightening continues.
With differing opinions on the Fed’s next move, Bitcoin’s trajectory remains uncertain, but liquidity shifts could play a decisive role in its next major rally.
