Arthur Hayes Says Crypto Crash Isn’t Over, Sees Second Wave Coming As “TradFi Over-Leveraged Muppets’’ Surface

BitMEX co-founder Arthur Hayes said the crypto market crash isn’t over yet and warned of an impending second wave as “TradFi over-leveraged muppets” start to surface.

If there is going to be a bailout, the market “needs to deliver more pain by Fri,” he wrote in an Aug. 6 post on X. “Enjoy the respite for the war shall continue,” he warned.

BTC And ETH Unable To Erase Weekly Losses

The warning from Arthur Hayes comes as markets recover from a battering on Monday. The Nikkei 225 index soared more than 10% in the last 24 hours after it fell 12% during yesterday’s trading session.

Similarly, the crypto market cap rose over 9% to about $1.9 trillion in the past 24 hours.

Crypto market leaders Bitcoin (BTC) and Ethereum (ETH) were able to climb more than 9% and 12%, respectively, in the last 24 hours. ETH bounced back after a 7-month low yesterday, while the flagship crypto reclaimed the $55K support after briefly falling below $50K on August 5.

However, BTC and ETH’s gains were not enough to push their weekly performances out of the red. Bitcoin’s price was still down over 16% on the longer-term timeframe, while Ethereum was down more than 24% over the past 7 days.

ARK Invest CEO Just As Cautious As Arthur Hayes

Arthur Hayes is not the only influential figure warning about risk in the markets after yesterday’s bloodbath. Ark Invest CEO Cathie Wood noted in an Aug. 6 thread on X that the Equity Volatility Index (VIX) recently shot up to 65, its fourth-highest level in 40 years.

After I recorded “ITK” on Friday, today the VIX (Equity Volatility Index) shot up to 65, the fourth highest level in the past 40 years: after “portfolio insurance” failed on Black Monday in October 1987, Lehman went under in 2008, and COVID hit in 2020. What does this move mean? https://t.co/5upiKbuiWd

— Cathie Wood (@CathieDWood) August 6, 2024

Wood said that the only periods the index has been higher were during Black Monday in October 1987, the collapse of Lehman Brothers in 2008, and when COVID hit in 2020.

The high VIX reading indicates investors anticipate extreme volatility in the coming 30 days.

Looking For Safe Havens Amid The Turbulence

Presale meme coins that are not yet at the mercy of the open market could be one option for crypto investors looking for shelter from this potential storm. 

Among analyst favorites right now are the layer-2 meme coin Pepe Unchained (PEPU), Base chain token Base Dawgz (DAWGZ) and the P2E project PlayDoge (PLAY).

PEPU has already raised more than $7.4 million and is offering presale buyers a 267% APY, while PLAY has moved to within a whisker of $6 million raised as it revitalizes the viral Tamagotchi game that was a 90s sensation.

Base Dawgz aims to challenge the dominance of the meme coin Brett on the Base blockchain and is offering investors at this early stage a 956% annual return if they stake their tokens.

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