The crypto market saw another eventful week with significant predictions and warnings for 2025. Arthur Hayes outlined the market’s trajectory for Q1 2025, while Robert Kiyosaki warned of a looming Bitcoin crash.
This week in crypto, Shiba Inu also announced a new token launch. Moreover,13 US states decided to move forward with Bitcoin Reserve legislation. Here’s a roundup of the week’s biggest stories.
Arthur Hayes: Crypto Market Will Peak in March, Then Crash!
Arthur Hayes, former CEO of BitMEX, has predicted a cryptocurrency market peak in mid-March 2025, followed by a severe correction. In an essay, Hayes attempted to answer whether or not the bullish momentum surrounding Trump’s election victory will continue.
Hayes noted that the incoming president might be unable to deliver on all his campaign promises, which could result in a drop in market sentiment. However, increasing dollar liquidity might offset the disappointment surrounding Trump’s policies in the short term.
Hayes explained that since Bitcoin bottomed in Q3 2022, its price has largely tracked the decline of the Federal Reserve’s Reverse Repo Facility (RRP) and the US Treasury’s General Account (TGA). The Fed’s quantitative tightening policy will remove $180 billion in liquidity by the end of Q1 2025. Still, the recent adjustment to the RRP rate is expected to result in a $237 billion liquidity injection, yielding a net positive liquidity of $57 billion.
The liquidity is expected to fuel the crypto market. Arthur Hayes is bullish on the crypto market’s near-term prospects. Still, he advises caution as the first quarter concludes.
“Sell in the late stages of Q1, then chill,” Hayes advised.
Robert Kiyosaki Warns of a Looming Bitcoin Crash
Robert Kiyosaki, author of the bestselling book Rich Dad Poor Dad, has warned that the biggest market crash in history is near.
Kiyosaki reaffirmed his long-standing predictions, blaming the upcoming crash on decisions made during the 2008 financial crisis. He argued that leaders, including former Federal Reserve Chairman Ben Bernanke, prioritized bank bailouts over supporting ordinary citizens.
Looking ahead to 2025, he predicted that expensive assets like houses, gold, silver, and Bitcoin would soon go on sale. He also noted that the world was on the brink of war, which, in his view, was making the situation worse.
“Please be smart. Many expensive assets will go on sale. I’ll be buying more real assets with fake US dollars,” Kiyosaki wrote on Twitter.
Nevertheless, over the past week, Bitcoin’s price dropped from a peak of $102,000 to as low as $92,000. At press time, BTC was trading at $94,932 after recovering slightly.
Shiba Inu to Launch TREAT in January
The second largest meme coin, Shiba Inu, is launching a new token in its ecosystem. In an announcement on January 2, the Shiba Inu team said TREAT will be launching in January.
TREAT deals with governance and rewards for the broader ecosystem. Its developers seek to transform Shiba Inu from a meme coin to an inventive blockchain network.
However, TREAT will not be available to the US audience. Without providing details, the announcement added a disclaimer stating that the new meme coin is not intended for the US. This exclusion could be related to potential regulatory or licensing challenges with US exchanges.
Nevertheless, Shiba Inu prices have been experiencing a downtrend over the past week. The launch of the TREAT token is anticipated to boost SHIB prices.
13 US States Push For Bitcoin Reserves
According to Dennis Porter, at least 13 US states, out of the total 50, are working on creating Bitcoin reserves. Porter is the CEO and co-founder of Satoshi Action Fund (SAC).
“I can confirm that at least 13 states are working on ‘Strategic Bitcoin Reserve’ legislation. January is going to be a record-breaking month for Bitcoin policy,” Porter tweeted on January 3.
Porter also added that a ‘tidal wave of Bitcoin policy’ is coming in 2025.
As Bitcoin emerges as a strong challenger to traditional assets like gold, there is rising global debate around BTC’s role as a national reserve asset. It was President-elect Donald Trump who initiated conversations around government Bitcoin reserves.
Several US lawmakers have already endorsed state Bitcoin reserves. Lawmakers from Texas, Ohio, Pennsylvania, and many others have pushed for BTC reserve legislation.
Banks Told to Pause Bitcoin Services, Coinbase Discloses
Coinbase has revealed that the Federal Deposit Insurance Corporation (FDIC) has instructed banks to pause Bitcoin services until new guidelines are established. This directive has raised concerns about the future of cryptocurrency services offered through traditional banking channels.
Coinbase’s Chief Legal Officer, Paul Grewal, revealed that the FDIC has sent additional letters urging banks to scale back their crypto-related operations. According to Grewal, these letters, which address everything from Bitcoin transactions to more advanced crypto services, are part of a wider effort to curb the growth of the crypto industry.
Ripple’s Chief Legal Officer, Stuart Alderoty, also emphasized that these FDIC directives seem designed to deter banks from engaging in any crypto-related business.
“Note that FDIC magically found TWO more pause letters in this search after saying before that it had complied with an earlier Court order. It’s hard to believe in their good faith when their sweater further unravels every time we pull on the thread. The new Congress should launch hearings on all this without delay,” Grewal said.
The move comes amid expectations of a favorable regulatory environment in the US following Trump’s election victory.
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