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PEPE: BitMEX Founder Took $23M Gamble to Whole New Level

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  • Arthur Hayes, the founder of BitMEX, purchased $250,000 worth of PEPE and $250,000 worth of MOG on September 27.
  • The value of Hayes’ PEPE and MOG holdings has dropped to $460,000, resulting in a loss of $40,000.
  • Hayes remains bullish on meme coins, despite the loss.

Arthur Hayes, the founder of BitMEX, is creating a stir for his investments in meme coins. Hayes recently bought an additional 23.48 million PEPE tokens, valued at over $1.5 million, even though his current meme coin holdings had declined. Despite the loss, Hayes maintains a positive outlook on meme coins.

On September 27, the crypto entrepreneur expressed his optimistic outlook about the future of meme coins and purchased $250,000 worth of PEPE and $250,000 worth of MOG. However, Hayes’ investments did not pan out as per expectations. Today, the value of his PEPE and MOG holdings has dropped to $460,000, resulting in a loss of $40,000. Undeterred by the loss, he remains convinced that meme coins are here to stay and have the potential to generate significant returns.

PEPE
PEPE: BitMEX Founder Took $23M Gamble to Whole New Level 2

PEPE, the frog-themed meme coin is making headlines for its high correlation with Ethereum. The token’s 60-day correlation with ETH stood at 0.92, a surge from June’s 0.91. On the other hand, its correlation with Bitcoin stood at 0.84. The reading close to +1, indicates that prices typically move in the same direction or a direct relationship. ETH and PEPE thus exhibit a strong positive correlation.

PEPE: Hayes Sees Meme Coins As the Future

Having said that, Hayes’ investment in PEPE and his vocal support for other meme coins could encourage traders, crypto enthusiasts, and even cautious institutions to invest in these asset classes. With the backing of high-profile investors like Hayes, meme coins, despite their notorious volatility, are gaining traction as potential speculative assets. This trend is particularly likely to accelerate when the overall crypto market, exemplified by Bitcoin’s recent resilience, stabilizes

Arthur Hayes has been a vocal proponent of meme coins for some time now. In August, he tweeted that he was “all-in” on meme coins and that he believed they were the future of finance. It is unclear whether Hayes will continue to invest in meme coins in the future. However, given his bullish stance on the asset class, it is likely that he will remain involved in the space.

BitMEX Guilty: Faces Massive 5 Years for BSA Violation

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BitMEX, the Seychelles-based crypto exchange, has pleaded guilty to violating the Bank Secrecy Act (BSA). This was announced on Wednesday by the U.S. Department of Justice (DOJ).

Court documents reveal that BitMEX failed to establish an adequate know-your-customer (KYC) and anti-money laundering (AML) program. This lapse occurred between September 2015 and September 2020. During this period, the Commodity Futures Trading Commission (CFTC) charged the exchange with offering illicit crypto derivative trading services to U.S. customers. The DOJ charged four of the exchange’s employees with BSA violations.

Until September 2020, BitMEX allowed customers to register and trade cryptocurrency anonymously, without any identifying information or documentation. The DOJ claims the exchange promoted itself as a platform where users could trade without real-name verification. This lax approach to AML/KYC standards, prosecutors say, made the exchange a hub for money laundering and sanctions violations.

U.S. Attorney Damian Williams commented,

“As BitMEX’s founders and long-time employee admitted in federal court in 2022, the company operated in the United States without any meaningful anti-money laundering program, as required by federal law. As a result, BitMEX opened itself up as a vehicle for large-scale money laundering and sanctions evasion schemes, posing a serious threat to the integrity of the financial system. Today’s guilty plea indicates again the need for cryptocurrency companies to comply with U.S. law if they take advantage of the U.S. market.”

BitMEX’s Old Charges

The 2020 charges against BitMEX’s co-founders Arthur Hayes, Samuel Reed, and Benjamin Delo, and its first employee, Gregory Dwyer, are nearly identical to the charge the exchange pleaded guilty to. The executives previously pleaded guilty as well.

In addition, BitMEX pleaded guilty to lying to a foreign bank as part of its BSA violation. The company and its executives made false statements to an unnamed international bank to convince it to open an account for a shell company called Shine Effort Inc. Limited. The exchange was the beneficial owner of this company.

A DOJ spokesperson did not comment on why the charges against BitMEX were filed four years after the same charges were filed against its executives. The exchange has not yet been sentenced. The case is being overseen by U.S. District Judge John G. Koeltl of the Southern District of New York. The exchange’s representatives did not respond to requests for comment.

BitMEX Sees Massive Bitcoin Outflow: What This Means for the Crypto Market

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A popular on-chain data provider, CryptoQuant, has shared that BitMEX has seen the second-highest outflow of Bitcoin in its history. This withdrawal of 35,486 BTC has attracted a lot of attention and discussions within the crypto space and could have an impact on other markets.

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In the past, the “Exchange Netflow” indicator on BitMEX has been very much associated with the price of Bitcoin. The price of Bitcoin rises when this indicator goes deep into the negative territory, where large outflows of BTC generally occur. The recent netflow of 35,486 BTC is quite significant and can be considered as one of the largest outflows from the platform to date which has naturally piqued the interest of the market.

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Major BTC Moves On BitMEX

Outflows of large amounts of Bitcoin from BitMEX have been taken to mean that big investors are withdrawing their funds. This is more of a transfer to a cold wallet for safekeeping or selling in another exchange at a more convenient time. Such actions alleviate the immediate selling pressure on BitMEX, thus supporting or even boosting the price of Bitcoin.

Events of this nature that have occurred in the BitMEX platform have in the past been known to predict the rise in Bitcoin prices. Therefore, it is very important for investors and market enthusiasts to pay a lot of attention to the Exchange Netflow indicator on BitMEX, since these strategic actions directly affect the crypto market.

The platform continues to play a significant part in determining the trends of the market as seen by the second largest outflow of Bitcoin in the platform’s history. In response to this major occurrence, investors and analysts are analyzing the situation, while the members of the crypto community are waiting for the prices to change and the strategies of market participants to change.

Dogecoin Poised For Major Bounce: BitMEX Co-Founder Bullish

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BitMEX co-founder Arthur Hayes is optimistic about Dogecoin, revealing he would add the token to its wallet. “I’m loving this choppy sideways to down shitcoin price action. I’m adding to my bags of PENDLE and DOGE,” he wrote. During a recent interview with macro guru Raoul Pal, Hayes predicted that Dogecoin might get an ETF, and discussed the impact of the US election on the market and potential risks in the future.

The OG meme coin is at a critical juncture, poised at the bottom of its current range, with many analysts believing the bull market is far from over. Aiming for an ambitious target of $1.69, market experts are confident that DOGE’s potential remains strong.

As per Santiment’s recent analysis, the lower a cryptocurrency’s 30-day Market Value to Realized Value (MVRV) ratio is, the higher the likelihood of a short-term bounce. Here’s the latest MVRV data:

  • Bitcoin: -4.0% (Mild Bullish)
  • Ethereum: -4.3% (Mild Bullish)
  • XRP: -3.5% (Mild Bullish)
  • Dogecoin: -16.7% (Very Bullish)
  • Toncoin: -0.6% (Neutral)
  • Cardano: -12.6% (Very Bullish)

With Dogecoin’s 30-day MVRV at a striking -16.7%, Santiment’s analysis signals a very bullish outlook, This massive dip could mean a significant rebound is on the horizon. DOGE’s bullish signals have a history of defying expectations, and this might be another one of those times

Dogecoin Bulls Eye $0.13

However, DOGE’s short-term price trend is at a crucial point, needing to close the weekly candle above $0.13 to maintain its bullish momentum and break out of the triangle formation to the upside. Should it fail to close above this level, there is a risk that Dogecoin might drop to $0.07, posing a potential setback for short-term traders.

Dogecoin
Image credit: CryptoJack

Despite the immediate pressure, the long-term sentiment around Dogecoin remains optimistic. The strong fundamentals, combined with the significant MVRV dip, highlight an opportunity for investors to potentially capitalize on the anticipated price surge.

Bitcoin Plummets: Bitmex Probe to Reveal Shocking $8.9K Dive Reason

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Bitcoin (BTC) experienced a sudden and significant dip late Monday, sending shockwaves through the cryptocurrency market. The crash occurred on BitMEX, a prominent exchange, where Bitcoin plummeted to as low as $8,900 within a matter of minutes. This stark drop contrasted sharply with prices on other exchanges, which remained well above $60,000.

The sudden slide commenced at 22:40 UTC, catching many traders off guard. Within just two minutes, Bitcoin’s price tumbled to its lowest point since early 2020. However, the recovery was equally swift, with prices rebounding to $67,000 by 22:50 UTC. Throughout this tumultuous period on BitMEX’s spot market, Bitcoin’s global average price hovered around $67,400.

Speculation ran rife on social media regarding the cause of the crash, with some attributing it to whale selling. According to reports, an entity offloaded over 850 BTC (equivalent to $55.49 million) on BitMEX, exerting immense downward pressure on the XBT/USDT spot pair, which ultimately reached $8,900.

Bitcoin’s Divergent Paths

BitMEX’s XBT index, tracking Bitcoin’s price, and the XBT/USDT pair, representing Bitcoin’s tether-denominated price, witnessed a stark disparity during the crash. Notably, while the spot market experienced a sharp decline, BitMEX’s derivatives markets, valued in billions, remained relatively stable.

In response to the unprecedented activity, BitMEX took to social media to address the situation. The exchange announced an immediate investigation into the large sell orders, emphasizing that all systems were functioning normally. BitMEX assured users that the platform was operational without disruptions and reiterated the safety of users’ funds.

BitMEX stated in a release,

“We launched an investigation as soon as we saw unusual activity on our BTC-USDT Spot Market. All of our systems were operating as normal, but we identified aggressive selling behavior involving a very small number of accounts widely beyond expected market ranges. We can’t comment on any specific behavior of a user or actions taken, and we continue to investigate.”

Despite the momentary turbulence, Bitcoin’s resilience was evident as it swiftly recovered from the crash. However, the incident underscores the inherent volatility of the cryptocurrency market, serving as a reminder for traders to exercise caution and remain vigilant in their dealings.

BitMex Co-Founder Sparks Debate: Is Cardano’s dApp Ecosystem Falling Short?

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Arthur Hayes, the co-founder of BitMEX, recently triggered an X (Twitter) storm with the ADA community about decentralized applications (dApps) on Cardano’s blockchain. In his X post, he criticized ADA advocates for failing to create any meaningful dApps on Cardano and called ADA “dog shit” while asking Cardano’s co-founder Charles Hoskinson for some education.

The post got an impulsive response from various members of the crypto field. In reply, market expert Dan Gambardello, Founder of Crypto Capital Venture, points out that it is not just enough to judge the network on the basis of trust but a proper grasp of its technical fundamentals.

Gambardello accentuated its native liquid staking system, which sits within its Ouroboros protocol, allowing ADA holders to stake without locking their funds for some definite time while displaying innovativeness and security features. He also said that unlike some protocols calling for additional dApps like Lido Finance, Cardano’s architecture accommodates them naturally, attracting value investors focusing on safety and stability.

Another member entered into the discussion, stressing that it was necessary to evaluate digital currencies through their technicalities rather than hype or price fluctuations. He observed that Cardano had a vibrant grassroots ecosystem in contrast to what one would have typically expected from other cryptocurrency projects of its kind since it has been making real technological progress. On the other hand, he disputed Hayes’ pessimism by stating that the real value of the network is in its solid infrastructure and capacity to develop a decentralized applications environment.

Insights Into Cardano’s Consensus Mechanism

Meanwhile, Cardano YODA, perusing the subtleties of blockchain consensus mechanisms, went into the safety and liveness of network operations. According to his X post, the comparison with other forms of consensus models like Solana and Ripple revolved around trade-offs between safety, liveliness, and transaction finality, which demonstrate the network’s bias towards liveness rather than safety.

Explaining safety and liveness in consensus algorithms, Cardano YODA showed how transaction finality is guaranteed by Ouroboros through a probabilistic mechanism that balances security needs with ongoing network operation requirements. Also, this highlights the resilience of Cardano against attempts to hack its blockchain by citing a security report from CERTIK that demonstrates the project’s strength compared to its peers in terms of total value locked (TVL).

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Nevertheless, Cardano’s reputation as a secure and modern technology platform still stood unscathed throughout this discussion. Its proponents have pointed out that it was distinguished by uniqueness and had innovative technology. The community continued to believe in the future and the network’s value proposition to the world of fast-evolving cryptography despite the dApp adoption phase leading to criticism.

BitMEX Founder’s Bearish Bitcoin Outlook: Prepares For Dip Below $35k

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BitMEX founder Arthur Hayes recently shared his insights on the current state of the financial markets, focusing on Bitcoin’s potential support level and the actions of key figures like US Treasury Secretary Janet Yellen and Federal Reserve Chair Jerome Powell.

Bitcoin Support Projections

According to a recent blog post, Hayes believed that Bitcoin could find support between $30,000 and $35,000. To position himself for this scenario, he revealed that he had purchased $35,000 strike puts set to expire on March 29th, 2024. In preparation for the potential BTC dip, Hayes disclosed that he had sold his trading positions in Solana and Bonk at a slight loss, emphasizing his intent to start “bottom fishing” once Bitcoin drops below $35,000.

Discussing the actions of Yellen and Powell, Hayes characterized their approach as oscillating between decisive actions and vague talking points. Yellen’s decision to shift borrowing to Treasury bills (T-bills) was highlighted as a move that injected significant liquidity into the markets. On the other hand, Powell’s talk about potential rate cuts and tapering of Quantitative Tightening (QT) was seen as mere rhetoric without immediate monetary stimulus.

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Hayes criticized the market’s interpretation of both Yellen and Powell’s actions and words as if they were equivalent, noting that while Yellen’s actions added liquidity, Powell’s talk did not result in increased monetary stimulus. Despite the S&P 500 and Nasdaq 100 hitting new all-time highs, Hayes cautioned that the real indicator of dollar liquidity, Bitcoin, was showing signs of concern, dropping from $48,000 to below $40,000.

He argued against two common explanations for Bitcoin’s recent dip – outflows from the Grayscale Bitcoin Trust (GBTC) and anticipation of the non-renewal of the Bank Term Funding Program (BTFP). Hayes contended that the second argument was more valid, suggesting that the cessation of the BTFP could lead to a mini-financial crisis, contrary to the confidence exhibited by Yellen and Powell.

Hayes concluded by providing charts to support his view that the Fed is trapped between inflation and a potential banking crisis, with Bitcoin acting as a key indicator. He emphasized the importance of watching Yellen’s upcoming actions, particularly in the Quarterly Refunding Announcement (QRA) on January 31st, to gauge the market’s direction.

However, Hayes painted a complex picture of the current financial landscape, expressing skepticism about the effectiveness of central bank communication and highlighting Bitcoin as a leading indicator for broader market movements.

Related Reading | Bitcoin Countdown: ViaBTC Predicts Post-Halving Price

Bitcoin’s Future Threats: Bitmex Co-Founder Arthur Hayes Issues Warning

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In a recent statement, Bitcoin’s potential downfall has been a cause for concern, as highlighted by Arthur Hayes, the former CEO and co-founder of BitMEX.Hayes particularly focused on the possible launch of Spot BTC ETFs, emphasizing that traditional financial (TradFi) asset managers could pose a significant threat to the pioneer cryptocurrency.

In his year-end article, Hayes asserted that if ETFs managed by traditional asset managers were wildly successful, they could “completely destroy Bitcoin.” He argued that Bitcoin’s uniqueness, distinguishing it from other monetary instruments, meant it was not designed to be controlled by these asset managers. 

Hayes speculated that if the world’s largest asset managers accumulated all circulating BTC, it could destroy the cryptocurrency.

Bitcoin’s Vitality Relies On Activity And Trading, Warns Arthur Hayes

Highlighting Bitcoin’s nature as an asset that thrives on movement and usage, Hayes contended that the cryptocurrency would “die” if it became stagnant. He emphasized the importance of active trading for Bitcoin’s survival. He noted that miners would lose transaction fees if the tokens were merely stored without being traded, potentially causing the BTC network to collapse.

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Bitcoin's Future Threats: Bitmex Co-Founder Arthur Hayes Issues Warning 9

Hayes’ remarks coincide with the impending decision on Spot BTC ETF applications. The former BitMEX CEO has previously expressed reservations about these funds and their issuers, suggesting that traditional financial institutions seek to become “crypto gatekeepers” rather than genuinely embracing Bitcoin’s ethos of decentralization.

While Hayes remains critical of institutional interest in BTC, some experts, like Bloomberg Analyst Eric Balchunas, see potential benefits in approving Spot BTC ETFs. Balchunas emphasizes the convenience these ETFs offer investors, and others are optimistic about the increased capital inflow that could follow their approval.

As the debate over the impact of institutional involvement in BTC continues, contrasting views emerge on whether it will hinder or contribute to the cryptocurrency’s mainstream adoption.

BitMEX Founder Warns: Bitcoin’s Fate Hangs In The Balance Amid ETF Surge

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BitMEX founder Arthur Hayes, in a thought-provoking blog post, explores the potential existential threat confronting Bitcoin. He highlights the increasing popularity of Exchange-Traded Funds (ETFs) managed by traditional finance (TradFi) asset managers. Hayes argues that the triumph of these ETFs might endanger Bitcoin, potentially turning it into a state-controlled financial asset and losing its original essence.

Bitcoin’s Unique Existence

According to Hayes, the recent surge in Bitcoin ETF applications from East Coast US financial giants has made the cryptocurrency more appealing to the political establishment. In a witty remark, he quips, “Never fade the right kind of white boys in Pax Americana,” hinting at the influence of certain players in the financial landscape.

Hayes expresses a primary concern regarding the fundamental disparity between Bitcoin and traditional monetary instruments. Unlike physical assets such as gold or fiat currency, Bitcoin’s value is intricately tied to its movement. He envisions a scenario where major asset managers, like BlackRock, accumulate BTC without utilizing the underlying blockchain, effectively rendering the cryptocurrency dormant.

The first monetary asset to exist solely through movement, Bitcoin faces a unique challenge. After block rewards dwindle to zero, miners will rely solely on transaction fees for income. If the network stagnates and transactions cease, miners cannot sustain the energy costs required to secure the network, resulting in a catastrophic shutdown.

Hayes proposes a scenario where BTC falls into the hands of major asset managers who, due to confusion and laziness, opt for Bitcoin ETF derivatives instead of holding the actual cryptocurrency. BTC becomes a dormant asset in this hypothetical future, leading to the network’s demise. However, Hayes finds beauty in this potential demise, as it opens the door for a new crypto monetary network to emerge.

Hayes presents a binary choice as he urges readers to consider their stance on the ongoing fiat debasement. Either trade ETFs for fiat gains or preserve wealth in energy terms by holding Bitcoin in self-custodied wallets outside the control of the state. In a closing statement, he underscores the importance of securing private keys, emphasizing the need to avoid handing them over to centralized entities.

Related Reading | Shiba Inu Sees Surge In Investments From Key Players Amid Ecosystem Expansion 

BitMEX Founder Dumps SOL For Ethereum, Foresees $5,000 Price Surge

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BitMEX founder Arthur Hayes has made a significant market move, announcing on the X platform that he has offloaded his SOL holdings in favor of Ethereum (ETH). Not only did Hayes share his decision to part ways with Solana (SOL), but he also professed a bold prediction for ETH, suggesting it will hit the $5,000 mark in the near future. According to the BitMEX luminary, he received a message from a higher power instructing him to “dump that Sam coin POS” and embrace his allegiance to Archangel Vitalik Buterin by acquiring more Ethereum. 

Market Dynamics: Ethereum (ETH ) vs. Solana (SOL)

Hayes’ decision to abandon SOL, one of the market’s high performers, in favor of Ethereum has raised eyebrows within the crypto community. Ethereum, currently priced at $2,330.32, experienced a rally of over 89.98% in 2023, prompting Hayes to speculate that a similar surge in 2024 could propel ETH to the coveted $5,000 mark.

ETH 1Y graph coinmarketcap
CoinMarketcap

According to data from CoinMarketCap, Ethereum’s 24-hour trading volume stands at a staggering $16 billion, reflecting the continued interest and momentum behind the second-largest cryptocurrency. In the last 24 hours alone, Ethereum has surged by 5.51%, showcasing its resilience and bullish trajectory.

On the other hand, Solana has proven itself as a formidable contender in the crypto space, boasting a remarkable yearly rise of 658.20%. In the past 24 hours, SOL has witnessed a notable increase of over 16%, pushing its market value to $41.8 billion. This surge has allowed Solana to surpass Binance Coin (BNB), claiming the coveted position of the fourth-largest cryptocurrency by market value.

SOL 1Y graph coinmarketcap 2
CoinMarketcap

Arthur Hayes’ strategic shift from SOL to ETH adds an intriguing layer to the ongoing narrative. Only time will tell if his prediction of Ethereum reaching $5,000 becomes a reality, but for now, the crypto community remains on the edge of their seats, eagerly watching the market’s every move.

Looking forward, in 2024, the crypto market anticipates a bullish trend, especially for Ethereum, driven by the potential approval of spot Bitcoin ETFs. Major investment firms like BlackRock and Fidelity have applied for ETFs, initially facing SEC skepticism. However, a positive outcome for Grayscale in a lawsuit against the SEC has boosted market confidence. The final decision on ETF approval is expected by January 10, 2024.

Related Reading | 69k Bitcoins Seized In Silk Road Face U.S. Judgment