According to foreign media reports, BitMEX's former CEO Arthur Hayes recently gave a set of judgements about the flow of Bitcoin and AI funds. In his view, the fact that Bitcoin had not moved much further in the near future was not merely a fundamental issue, but more important because market funds were being sucked away from AI.
Financial flows to AI
Hayes indicated that AI had become one of the strongest investment narratives in global capital markets in the past few years. Large amounts of funds went to the AI equity, infrastructure development and data centre projects, and the liquidity that might otherwise have been allocated to encrypted assets was diverted.
In his view, that was one of the reasons why Bitcoin had still not taken a stronger position in the context of the expansion of its institutions and the improvement of its long-term narrative. Short-term price performance ultimately remains dependent on the willingness of funds to enter the market.
Hayes warns of foam risk.
Hayes also offers a more radical judgement about the investment boom in AI. In his view, over the past six to seven years, the market had invested huge amounts of capital in the AI area and future investors might revisit the real returns on those projects.
If part of AI projects fail to generate returns matching inputs, the withdrawal of funds may be rapidly amplified. He even claimed that once the AI bubble broke, the impact could be larger than the 2008 subprime crisis.
Liquid or Backstream Encryption Market
Hayes further argues that once AI has triggered a financial shock, governments and central banks probably still stabilize banks and markets by placing more liquidity. This is also the logic of what he calls a “big print” transaction.
According to this methodology, if investors lose confidence in AI assets, new liquidity needs to be found, and encrypted assets can be one of the receiving directions. Based on this premise, he considered that bitcoin had a long-term potential to rise to $1 million.