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Arthur Hayes, co-founder of the cryptocurrency exchange BitMEX, recently shared his optimistic outlook on the cryptocurrency market. In a tweet, Hayes stated that he believes the market is poised to enter a bull mode after the recent turmoil caused by the SVB liquidation and USDC's depegging.
Hayes' statement comes at a time when the market has been experiencing high levels of volatility. The depegging of USDC, a popular stablecoin, caused a significant price drop across the market. Additionally, the liquidation of SVB, a large Chinese mining operation, added to the uncertainty and contributed to further price drops.
Gamza KhanzadaevHowever, Hayes is confident that the market will rebound, considering the recent injection of $1 billion from Binance's fund, which is aimed at stabilizing the market by buying up assets such as Ethereum, Binance Coin and Bitcoin. This injection of capital could provide much-needed support to the market and help it recover from recent losses.
Recently, Hayes cited the Federal Reserve's collateral policy, which relates to its lending operations to banks and other financial institutions. The collateral that banks pledge to the Fed serves as a guarantee for the loans they receive, and the Fed's margin requirements dictate how much collateral they must pledge to secure the loan. The Fed's collateral policy is designed to ensure that it has adequate collateral to protect itself from losses if the borrower defaults.
The collateral is valued at par, which means it is valued at the face value of the asset, and the margin requirement is 100% of the par value, which means the value of the collateral provided by the bank must be equal to or greater than the amount of the loan.
The introduction of the new policy is tied to the most recent liquidation of SVB and Silvergate banks, which is closely tied to cryptocurrency companies like Tether and Circle.
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