 ▲ Bitcoin (BTC) plunge / Gemini-generated image © |
An expert has issued a strong warning that Bitcoin’s (BTC) recent sharp rebound from $63,500 to $74,123 may be nothing more than a dead-cat bounce—a temporary recovery within a broader downtrend—drawing significant attention from the market.
According to cryptocurrency-focused media outlet Finbold on March 5 (local time), Arthur Hayes, co-founder of BitMEX, noted on social media that Bitcoin’s price over the past year has closely mirrored the fractal patterns of major U.S. software-as-a-service (SaaS)-focused indices. Citing its correlation with the iShares Expanded Tech-Software Sector ETF and the Nasdaq-100 index, he questioned the sustainability of the current rally.
On-chain data shows that whale and shark-level investors have turned bullish with aggressive accumulation. Bitcoin’s open interest also rebounded from $44 billion to $49.8 billion in just two days, suggesting fresh capital inflows into derivatives and futures markets. In addition, funding rates have turned positive, indicating that many traders are betting on further upside.
Despite the growing optimism in the market, Hayes strongly warned Bitcoin buyers of the potential for a bull trap. He cautioned that another capitulation phase could occur before a true market bottom is fully formed, urging investors to remain patient as the crisis may not be over.
These concerns about a potential bull trap are gaining traction among trading experts. Following the crypto market crash on October 11, 2025, which wiped out $19 billion in leveraged traders’ funds, Bitcoin has remained trapped in a broader macro downtrend similar to that of 2022.
Outlooks remain divided. From a technical analysis perspective, Benjamin Cowen, CEO of Into the Cryptoverse, expects Bitcoin to show strength amid the ongoing crisis in the Middle East. On the other hand, Bitcoin bulls argue that improved regulatory clarity for cryptocurrencies in the United States, along with an impending capital rotation from gold—which has recently seen a parabolic rally—could drive the next surge.
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