Hayes Predicts AI Bubble Burst Will Send Bitcoin Soaring

Arthur Hayes, co-founder of BitMEX, believes that the AI investment frenzy will eventually lead to a burst bubble similar to the 2008 housing market. He argues that markets are treating AI infrastructure spending as a high-growth technology investment, but it's actually more like commercial real estate.

Lenders, private credit funds, and governments are financing a massive buildout of data centers and power infrastructure under the assumption that demand will keep accelerating indefinitely. Hayes predicts that this assumption will eventually break down in 2027, exposing companies and investors who borrowed heavily to finance projects.

Unlike the dot-com crash, which was an earnings story, Hayes says the AI boom is fundamentally a credit story similar to the housing market before the global financial crisis. He believes governments would be unwilling to let strategically important AI companies fail due to their importance to national security, and instead would respond with large-scale bailouts and liquidity injections.

According to Hayes, this wave of money creation would eventually spill into crypto markets, leading to a secular rise in Bitcoin prices. He predicts that panic-driven stimulus could push the asset to $1 million or higher.