The recent drop of bitcoin below the $100,000 threshold has reignited market tensions, shaking a symbolic level for investors. Behind this technical retreat lie more complex signals. While some fear a lasting bearish trend, several influential voices in the sector see it as a transitional phase with potential for a rebound. Between behavioral analysis and macroeconomic dynamics, this correction could mark much more than a simple temporary adjustment.
In Brief
- •Bitcoin has fallen below the symbolic $100,000 threshold, reigniting concerns about the market’s condition.
- •According to Matt Hougan (Bitwise), this drop reflects a capitulation of retail investors, not a lasting collapse.
- •He believes that retail exhaustion paves the way for a return of institutional players and a potential rebound.
- •Arthur Hayes (former BitMEX CEO) offers a macroeconomic perspective: the next bull run could be fueled by a “stealth QE” from the Fed.
The Reading of Matt Hougan
In a statement broadcast by CNBC, Matt Hougan, Chief Investment Officer at Bitwise, offered an unambiguous reading of the recent drop of bitcoin below $100,000.
For him, this level does not mark the beginning of a prolonged collapse, but rather a moment of retail investor capitulation. He stated, “The mainstream crypto market is in complete despair,” pointing to the extreme nervousness of retail investors.
According to Hougan, the market is undergoing an unprecedented “retail flush-out,” where non-professional sellers are disposing of their positions amid psychological exhaustion and successive losses. This purge, according to him, could well constitute a prelude to a phase of stabilization, even a rebound.
Hougan bases his optimism on several convergent signals he observes in the field. He believes that the long-term fundamentals of the market remain solid, notably thanks to the persistent appetite of institutional investors.
He says, “when I talk with institutions or financial advisors, they remain enthusiastic about allocating capital to an asset class that continues to offer very solid returns.” For him, once retail selling pressure is exhausted, the recovery could rely on these more structured actors. He highlights the following key elements:
- •The gradual extinction of leverage effect among retail investors, a sign of market cleansing.
- •Widespread pessimism in retail circles, often an indicator of a cycle bottom.
- •Intact interest from institutions, ready to strengthen their exposure at price levels deemed attractive.
- •A clear bullish forecast: Hougan mentions the possibility of bitcoin reaching $125,000 – $130,000 by the end of this year, if market conditions evolve favorably.
This reading, anchored in direct observation of market dynamics, suggests that the current volatility might hide an opportunity, provided the retail hemorrhage stabilizes and the institutional succession takes over.
Arthur Hayes and the “Stealth QE”: The Hidden Monetary Factor
Arthur Hayes, co-founder and former CEO of BitMEX, approaches the recent bitcoin drop from a completely different, more macroeconomic angle. In an essay published on November 4, he argues that the continuous rise of U.S. debt will force the Federal Reserve to resort to unconventional monetary easing forms.
He speaks of “stealth QE,” meaning a mechanism whereby the Fed would quietly inject liquidity via its Standing Repo Facility, to indirectly support the financing of Treasury bills. For Hayes, this process, though little publicized, would be fundamental: “if the Fed’s balance sheet increases, it means a liquidity injection in dollars, which eventually lifts the price of bitcoin and other cryptos,” he writes.
Hayes’s thesis fits into a structural reading of the market. By injecting liquidity into the financial system, the Fed would create a favorable environment for risky assets, which bitcoin would benefit from primarily. Unlike rise mechanisms based on the influx of new investors, this would be an indirect consequence of U.S. monetary policy.
This perspective provides a complementary viewpoint to that of Hougan: where one sees an opportunity related to market psychology, the other detects an upcoming mechanical effect, rooted in budgetary balances and the United States’ financing strategies.
Despite the current bearish pressure, the analyses of Matt Hougan and Arthur Hayes offer contrasting, but converging perspectives. Whether it is retail exhaustion or implicit monetary support, the price of bitcoin could still surprise.