Arthur Hayes blames BlackRock IBIT hedging flows for accelerating Bitcoin crash
BitMEX co-founder Arthur Hayes has argued that BlackRock’s iShares Bitcoin Trust (IBIT) may have played a central role in the recent Bitcoin crash, suggesting that dealer hedging tied to structured products accelerated the downturn.
In a post on X, Hayes said the sell-off was likely triggered by forced hedging activity as Bitcoin broke through key levels, prompting dealers to become “forced sellers” in order to manage risk exposure.
He also noted that he is compiling a broader list of bank-issued notes to identify similar trigger points that could amplify volatility. Bitcoin fell as low as $60,000 during the decline, before rebounding above $70,000, gaining more than 7% in a single session. The move came after BTC dropped more than 50% from its all-time high, shaking confidence across the crypto market.
Structured products and ETF outflows add pressure to market sentiment
Hayes’ comments align with growing scrutiny over how institutional products may amplify Bitcoin price swings. He pointed to a Morgan Stanley note that peaked near $105,000, placing a 75% knock-in level around $78,700 — a threshold that, once breached, could have triggered automatic hedging flows. As Bitcoin pierced that level, dealers may have been forced to sell into weakness, worsening the decline.
The broader crypto market saw roughly $2 trillion wiped from its capitalization compared with last October’s peak near $4.38 trillion. Meanwhile, U.S. spot Bitcoin ETFs that accumulated heavily in 2025 have reportedly shifted into net selling territory this year. CryptoQuant noted that institutional demand has “reversed materially,” warning that steady ETF redemptions signal fading enthusiasm from traditional investors.
Trump’s crypto-friendly stance fails to offset broader market forces
The downturn has raised questions about why Bitcoin remains under pressure despite President Donald Trump’s pro-crypto posture and regulatory expectations. BTC initially surged after Trump returned to the White House, as markets anticipated a friendlier policy environment and pointed to the administration’s indirect ties to crypto through World Liberty Financial (WLFI). However, analysts say macro volatility and cross-asset stress have outweighed political tailwinds.
Precious metals have also turned more unstable, with leveraged buying driving sharp moves in gold and silver, and spillover effects hitting crypto-linked equities like MicroStrategy. The latest episode underscores how Bitcoin’s market structure is increasingly shaped by institutional positioning, derivatives, and ETF flows — leaving prices vulnerable to rapid swings even in a supportive political climate.
Recently we wrote that Google search volume for the term “Bitcoin” surged over the past week as the cryptocurrency briefly dropped to the $60,000 level for the first time since October 2024.
-
Afghanistan
-
Albania
-
Algeria
-
Angola
-
Argentina
-
Armenia
-
Australia
-
Austria
-
Azerbaijan
-
Bahamas
-
Bahrain
-
Bangladesh
-
Belarus
-
Belgium
-
Bolivia
-
Botswana
-
Brazil
-
Brunei
-
Bulgaria
-
Cambodia
-
Cameroon
-
Canada
-
Chile
-
China
-
Colombia
-
Congo
-
Costa Rica
-
Cote d'Ivoire
-
Croatia
-
Cuba
-
Cyprus
-
Czechia
-
DR Congo
-
Denmark
-
Dominican Republic
-
Ecuador
-
Egypt
-
El Salvador
-
Estonia
-
Eswatini
-
Ethiopia
-
Finland
-
France
-
Georgia
-
Germany
-
Ghana
-
Greece
-
Haiti
-
Hong Kong
-
Hungary
-
India
-
Indonesia
-
Iran, Islamic republic
-
Iraq
-
Ireland
-
Israel
-
Italy
-
Jamaica
-
Japan
-
Jordan
-
Kazakhstan
-
Kenya
-
Korea
-
Kuwait
-
Kyrgyzstan
-
Laos
-
Latvia
-
Lebanon
-
Lesotho
-
Libya
-
Lithuania
-
Luxembourg
-
Madagascar
-
Malaysia
-
Malta
-
Mauritius
-
Mexico
-
Moldova
-
Mongolia
-
Montenegro
-
Morocco
-
Mozambique
-
Myanmar
-
Namibia
-
Nepal
-
Netherlands
-
New Zealand
-
Nigeria
-
North Macedonia
-
Norway
-
Oman
-
Pakistan
-
Palestine
-
Panama
-
Papua New Guinea
-
Paraguay
-
Peru
-
Philippines
-
Poland
-
Portugal
-
Puerto Rico
-
Qatar
-
Reunion
-
Romania
-
Rwanda
-
Saudi Arabia
-
Serbia
-
Singapore
-
Slovakia
-
Slovenia
-
Somalia
-
South Africa
-
Spain
-
Sri Lanka
-
Sweden
-
Switzerland
-
Syria
-
Taiwan
-
Tajikistan
-
Tanzania
-
Thailand
-
Trinidad and Tobago
-
Tunisia
-
Turkey
-
UAE
-
Uganda
-
Ukraine
-
United Kingdom
-
United States
-
Uruguay
-
Uzbekistan
-
Venezuela
-
Vietnam
-
Yemen
-
Zambia
-
Zimbabwe
- Forex
- Crypto
