Arthur Hayes is bullish: AI bubble is the biggest opportunity for BTC

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In his latest long-form article, Arthur Hayes points out that the US and China are printing money frantically for the AI arms race, and combined with the US-Iran conflict driving up inflation, fiat liquidity will continue to flood the market. Bitcoin has bottomed out at $60,000, with a target to return to $126,000, and altcoin season is imminent. Deconstructing the current macro situation: The US and China are printing money and lending at all costs for AI hegemony, and coupled with the geopolitical risks triggered by Trump bombing Iran, a "perfect environment" is being created for cryptocurrencies. He bluntly states that Bitcoin has bottomed at $60,000, supported by trillions of dollars and RMB yet to be printed, and a return to $126,000 is a certainty. In his latest Substack long-form article "The Butterfly Touch," Arthur Hayes supports that the capital expenditure (CAPEX) for AI model training and inference is unprecedented in human history. Many believe that the value created for humanity by this investment in intelligence will be different from all previous technological construction. I agree; however, as humans, we always overdo it. In this universe, positive infinity and perfection are unattainable. Therefore, in anticipating a future driven by machine intelligence, we are likely to build in excess. AI proponents cite nationalism as a reason for lavish spending, but patriotism should not have a price tag... Both the US and China believe that AI and technological hegemony are vital to the survival of their territories. Tech giants are also very happy to sell them the threat narrative: what will happen to this country if the other side achieves machine intelligence hegemony first. Objectively speaking, both leaders have witnessed firsthand how the proliferation of AI and drones brings victory and are convinced of it. Therefore, they will ensure that the primary economic and military goal is to further build the most efficient machine intelligence within their borders. Arthur Hayes (@CryptoHayes) x @_dsencil at @TheBitcoinConf 2026 in Las Vegas “Bitcoin is literally just a derivative of how much fiat is there in the world” 🔸Not a bull run – slow grind 🔸Real breakout = $145K 🔸AI = potential credit shock Liquidity drives everything. pic.twitter.com/LYq88LK22I — Bitcoin.com News (@BitcoinNews) May 1, 2026 In the US, most AI CAPEX to date has come from the operating cash flow of the most profitable software companies. But given the scale of current and future spending, financing needs to be increased through credit channels. In China, banks are slowing down funding for real estate and turning to fund the tech industry. In addition to spending related to data centers, both the US and China are continuously investing funds to increase power supply. In other words, central banks are creating more fiat currency and loosening financial conditions. The combination of political will (winning the AI race) and financial will (funding construction through money printing and loans) creates a perfect environment for cryptocurrencies. There will be far more fiat units tomorrow than today, and the rate of change is accelerating due to the surge in AI and electrification spending. As the cost per unit of intelligence drops, the complexity of tasks performed by AI increases, which means computing power consumption grows exponentially; this is the essence of the "Jevons Paradox." There is also the "Red Queen Effect": as competitors improve model efficiency, the AI CAPEX invested by a company will rapidly depreciate. This leads to a race to increase spending further to build better models to defeat opponents, while also rendering the hundreds of billions (soon to be trillions) invested by opponents obsolete. Therefore, unless hindered by exogenous market events, AI CAPEX spending will expand infinitely. I believe two events will occur almost simultaneously and change people's perception of the necessity of spending trillions to build AI. Market Indigestion: An AI-related IPO or massive M&A of huge scale and financial irresponsibility occurs, which the market cannot absorb. This will sober the market from its mania, and people will begin to question whether machine intelligence is really worth that much money. Political Wind Shift: The 2028 US election. The rise in prices of raw materials, labor, and especially electricity caused by large-scale AI construction is unpopular in many regions. Furthermore, 90% of Americans do not hold significant stocks and cannot benefit from soaring stock prices. Politically, it is very easy to win votes by being anti-AI, focusing on the value of human labor, and curbing inflation. But at this very moment, USD and RMB liquidity will continue to rise. Bitcoin and cryptocurrencies will benefit from this. Trump bombed Iran, not caring at all about the impact of the war on the global economy. Or perhaps he does care, but the assumption that this year's

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