AI Boom Absorbs Crypto Capital, Hayes Says

Bitcoin's sluggish performance has been attributed to various factors, but Arthur Hayes believes it's not due to a lack of liquidity. Instead, he says that the AI investment boom has become the market's biggest capital magnet, absorbing nearly every fresh dollar that would have otherwise flowed into crypto.

In an interview with Bonnie Blockchain on June 26, Hayes explained why Bitcoin continues to lag even as global money supply expands. He pointed out that the rise in dollar M2 has been largely matched by massive spending on AI companies and their supply chains.

Hayes compared today's AI frenzy to the way investors previously chased Apple's suppliers whenever Apple entered a new growth cycle. In his view, AI has simply become the market's dominant trade. People who made substantial money from AI are first spending on real-world assets like homes, luxury cars, and private aircraft.