Bitcoin Could Hit $1 Million as AI Boom Ends in Credit Crisis

Arthur Hayes, co-founder of BitMEX and chief investment officer at Maelstrom, believes Bitcoin could reach $1 million if the AI boom ends in a credit crisis that forces large-scale government intervention.

Hayes argues that today's AI spending resembles a real estate credit bubble rather than a traditional technology bubble. He points out that annual spending on AI infrastructure is estimated to be between $400 billion and $700 billion, while critics argue many enterprise AI projects have yet to generate meaningful returns.

Hayes also notes that costly GPUs may become obsolete before data centers recover their construction costs. Power grid limitations, lengthy permitting processes, and supply chain bottlenecks could prevent many announced projects from being completed, adding further pressure to the sector.

If a severe contraction in AI-related credit markets prompts intervention from U.S. authorities, Hayes believes that liquidity injections would increase the money supply, benefiting scarce assets like Bitcoin. He expects government support to mobilize as much as $280 billion to aid AI-related companies.