Bitcoin bounced back from the flash crash earlier this week after reports on the potential rejection of a widely anticipated spot ETF approval in the US. While investors have maintained a positive outlook, BitMEX founder Arthur Hayes has offered a cautious perspective on the future of the asset.

In fact, the prominent commentator is gearing up for a “vicious washout of all the crypto tourists” in March of this year, with a potential correction in the range of 20% to 30%.

Hayes Predicts 20-30% Correction for Bitcoin

In the latest blog post, Hayes suggested that the correction might be even more pronounced if the anticipated launch of US-listed spot Bitcoin ETFs materializes, speculating that the influx of fiat into these products could drive BTC prices above $60,000, approaching the 2021 all-time high of $70,000.

He further went on to emphasize the possibility of a more substantial 30% to 40% correction, attributing it to a potential “dollar liquidity rug pull.”

Hayes revealed his decision to refrain from buying Bitcoin until after the March decision dates have passed. Demonstrating his trading strategy, the former BitMEX CEO outlined plans to top-tick the market in late February and purchase sizable put options with a June 28th expiry, strategically avoiding the March 29th expiry due to concerns about negative theta overwhelming other factors.

“The longer expiry will be more expensive, but the premium won’t decay as fast because maturity is over a quarter out. I’ll set my maximum loss, which will be sizable relative to my standard trading position, and then purchase the puts.

To get some juicy gearing on these puts, I will choose a strike 20% to 25% out of the money based on the current at-the-money quarterly June futures contract price.”

Bull Market to Continue After March

According to Hayes, the current crypto bull market is in its early stages, and advised investors not to get carried away with their enthusiasm.

By the end of March, he expects the market to regain its footing. Meanwhile, Hayes believes US Secretary of the Treasury Janet Yellen and Federal Reserve Chair Jerome Powell would continue to take measures to protect the fiat solvency of the Pax Americana financial system.

Despite anticipating a brief period of market turmoil, the exec remained optimistic about the market’s upward trajectory, particularly with the upcoming Bitcoin block reward halving. He also announced his plans to resume selling T-bills for Bitcoin and other crypto assets as the market speculation intensifies.