Billionaire analyses the state of crypto markets and reports that some major players are out of Bitcoin to sell

Arthur Hayes, creator of BitMEX, speculates that Bitcoin’s bear market bottom may have already been reached, claiming that three important players have likely run out of BTC to sell.

In a recent blog article, the crypto veteran outlines three investor groups who were compelled to sell their Bitcoin hoards in 2018 owing to improper use of leverage: centralized lending and trading organizations, Bitcoin miners, and regular speculators.

After the failure of crypto hedge fund Three Arrows Capital (3AC) and Sam Bankman-trading Fried’s business Alameda Research, Hayes asserts that centralized institutions have likely sold off the majority of their Bitcoin.

“Large quantities of the most liquid cryptocurrencies, Bitcoin (WBTC in DeFi) and Ether (WETH in DeFi) were transferred to controlled and decentralized exchanges and then sold. This occurred during the massive march down…

I cannot establish beyond a reasonable doubt that every Bitcoin owned by these collapsed institutions was sold throughout the various collapses, but it does seem that they attempted to sell the most liquid crypto collateral they could before failing.

The majority of Bitcoin has already been sold by [centralized lending institutions] and all significant trading businesses. Now, only illiquid sh**coins, private crypto company holdings, and locked pre-sale tokens remain.”

Since the initial credit crunch in June, when the king cryptocurrency fell below $20,000 for the first price in over 18 months, Bitcoin miners, according to Hayes, have been net sellers of BTC.

“They must do this in an effort to remain current on their massive amounts of fiat debt.” And even if they don’t have debt, they still need to pay electrical costs. Since the price of Bitcoin is so low, they must sell even more to keep the facility functioning.

Hayes claims he uses the quantity of open interest (OI) on long and short contracts to evaluate the extent of market speculation by regular speculators. According to him, the all-time peak in OI occurred simultaneously with the all-time peak in BTC. As the market collapsed, the OI likewise dropped, indicating that speculators were wiped out.

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