Arthur Hayes predicts AI bubble burst before bitcoin recovery

Wednesday 10 June 2026 - 09:07

By: Dakir Madiha

Arthur Hayes predicts AI bubble burst before bitcoin recovery

Arthur Hayes, cofounder of BitMEX, argues that bitcoin will not stage a durable recovery until the artificial intelligence investment boom collapses. In a recent essay, he links crypto market weakness to the scale of capital flowing into AI infrastructure and the way it has reshaped global liquidity since late 2022.

Hayes says around 1.5 trillion dollars in debt has been raised to finance AI-related infrastructure in the past two years. He claims this wave of borrowing has absorbed much of the new dollar liquidity created over the same period, leaving fewer funds available for risk assets such as bitcoin. During the same timeframe, he notes that Nvidia has risen roughly elevenfold while bitcoin has increased about sevenfold from its late-2022 lows, underscoring what he describes as a capital imbalance driven by AI enthusiasm.

He also points to a coming wave of large initial public offerings as a major stress test for markets. Companies including SpaceX, Anthropic and OpenAI are expected to pursue listings that could collectively raise more capital than the entire dot-com era IPO cycle. SpaceX has reportedly filed a registration statement targeting a valuation near 1.8 trillion dollars, while Anthropic and OpenAI are preparing potential listings at valuations around the trillion-dollar mark. Hayes argues that such concentrated supply of new equity could pull even more liquidity away from digital assets.

In his portfolio commentary, Hayes says he has sold positions in several alternative tokens, including HYPE, NEAR, WLD and ZEC, while maintaining exposure to bitcoin and ether. He expects a two-phase market cycle in which crypto assets first decline before rebounding sharply. He attributes the potential downturn to tighter financial conditions driven by oil price pressures, geopolitical tensions linked to the United States and Iran, and limited near-term monetary easing from the Federal Reserve under its current leadership. He argues that sustained inflation risks reduce the likelihood of immediate rate cuts.

Market participants have noted growing concerns that high-profile listings and capital rotation into AI-linked equities are diverting funds away from crypto markets. Some analysts also point to the expected trading debut of SpaceX shares as a near-term catalyst for further capital reallocation. Hayes maintains that any crypto weakness would be temporary and that a broader financial shock triggered by an unwinding AI bubble would eventually force monetary expansion, creating conditions for bitcoin to recover.