Crypto market observers and commentators have predicted positive trends related to the inauguration of President-elect Donald Trump in January 2025. However, Arthur Hayes, co-founder of BitMEX, has a different view.
Hayes warned about the high expectations of the Crypto policy changes that Trump has promised, emphasizing the gap between market expectations and the practical implementation of policies.
In his blog post "Trump Truth" released on December 17, Hayes said his investment fund, Maelstrom, plans to reduce some early investment positions to buy back at lower prices in the first half of 2025.
Unlike many forecasters, Hayes doubts that the US and other countries will soon begin to establish national Bitcoin (BTC) reserves.
The gap between high expectations and no quick solutions
"The market believes that Trump and his team can immediately achieve economic and political feats," Hayes wrote, pointing to the stark difference between the high expectations of Crypto investors and the "lack of politically acceptable solutions" immediately.
The implementation of any Crypto policy changes could take longer than the market expects, Hayes predicts, adding:
"The market will immediately realize that Trump, at best, only has one year to implement any policy changes by or around January 20. This realization will lead to a vicious sell-off in Crypto and other Trump 2.0 stock trades."
Therefore, Hayes predicts a "strong sell-off" around Trump's inauguration before Crypto enters a "boom phase" later in 2025.
Hayes' Maelstrom plans a Presale
As Hayes anticipates the market will experience a sharp decline around Trump's inauguration in January, Maelstrom - the investment fund managed by Hayes' family office - will liquidate some positions in the hope of buying back at lower prices.
"Maelstrom will reduce certain positions upfront, hoping to buy back some core positions at lower prices at some point in the first half of 2025," Hayes said.
The entrepreneur justified this sale by stating that long-term investors have "not invested enough" in the rest of the bull market, while many who hold back "often end up selling too early." He added:
"We are committed to accepting failure if the market price rises beyond January 20, licking our wounds, and returning to the bull run [...] I will buy the Dips and Peaks."
Crypto markets have entered a major rally since Trump's victory in the presidential election in early November, with Bitcoin surpassing $100,000 for the first time in history in early December.
Matrixport forecasts a strong start for Bitcoin in 2025. Source: Matrixport
Some analysts have predicted that Trump's Crypto policy changes are likely to make Bitcoin and DeFi the dominant trends.
The Singapore-based Crypto platform Matrixport said they expect Bitcoin to have a "strong start" in 2025, and added that many investors may look back and wonder why they didn't accumulate more.
However, Hayes is not the only one predicting some negative market developments in early 2025. According to Protos, there are market rumors that MicroStrategy may enter a hiatus period in January 2025, which would halt the issuance of stocks and convertible bonds to buy more BTC.
