Arthur Hayes predicts Ethereum will reach $5K after merge if Fed pivots
BitMEX founder Arthur Hayes said: predicted Ethereum (ETH) price could rise to $5,000 if the consolidation upgrade succeeds and the Federal Reserve pivots forward.
Hayes also revealed that Ethereum’s current price is 76% below his model price of $2,815, making it a huge buying opportunity for investors.
ETH to $5000
In an Aug. 5 post, Hayes said the Fed’s move toward “supporting growth rather than fighting inflation” would lead to higher volumes.
In this scenario, he believes that when the Ethereum merge finally takes place in September, the digital asset could go above $5,000 as it becomes a deflationary asset in high demand.
The annual issuance rate of Ether is ~90% Under the new PoS model… Ether taken out of circulation will only increase as the network becomes more popular… All these factors combined should still drive the price of Ether up exponentially.
No Federal Reserve Pivot + Successful Ethereum Merger
In a situation where the Federal Reserve reverses its decision to support growth by printing more money, Hayes believes the merger could still push the price of Ethereum to $3,562.
According to Hayes, the merger is expected to trigger a “triple halving” event for Ethereum. Bitcoin (BTC) price has always reacted positively to the halving, so we can expect ETH price to do the same.
Other predictions
Hayes continued that if the Ethereum merger failed or was interrupted and the Fed changed course, the asset price would not be adversely affected as it could remain at the current $1,600 level.
However, many people are disappointed by failed promises.
Explaining how the $1,600 forecast was reached, Hayes said that without the merger excitement from June 17 to July 26, Ethereum would have risen 1.72%.
So if the merge fails, the price drops to $1,099. However, as the Fed pivot increases liquidity, we expect ETH to eventually rise, similar to when the Fed expanded the money supply again from March 2020 to 2021.
On the other hand, in a scenario of no Fed pivot and an unsuccessful Ethereum merge, Hayes predicted that ETH would likely return to its July 17th low of $1,081.
