Arthur Hayes: AI Bubble Burst Will Trigger "Hyper-Money Printing," Boosting Bitcoin Back to Bull Market

BlockBeats News, August 5th, Arthur Hayes published a new article titled "Situationship," proposing that the AI bubble may eventually burst, but its subsequent impact could drive global liquidity expansion and become the catalyst for Bitcoin's next bull market.

Hayes believes that the key to determining whether AI is in a bubble lies in how investors define AI infrastructure development. He points out that the market generally views the tens of trillions of dollars in AI capital expenditure as "tech investment" and assigns it high growth valuations, but its essence is closer to "real estate investment."

He states that the current AI infrastructure development is actually building underlying assets that host computing power, such as data centers and power facilities, rather than directly investing in tech giants like Apple. "Financial institutions, private credit funds, and governments may mistakenly believe that investing in AI data centers is equivalent to investing in tech titans, when in reality it is more akin to investing in highly leveraged infrastructure projects."

Hayes believes that the core reason for the AI bubble's burst is not the inability of companies to realize profits but rather excessive credit expansion. He suggests that with support from the U.S. and Chinese governments, financial intermediaries may be overbuilding data centers, power facilities, and related supply chains, eventually creating a credit cycle risk similar to the 2008 financial crisis, rather than a profit valuation crisis like the 2000 dot-com bubble.

However, Hayes believes that the long-term value of AI is still immense. He points out that the computing resources running inside data centers will drive the development of "silicon-based life" and have a profound impact on human civilization similar to the railway era.

Regarding market impact, Hayes expects that after the AI bubble bursts, governments and central banks worldwide may adopt more aggressive monetary easing measures, repairing the financial system through "large-scale money printing," driving risk assets back into an uptrend, and ultimately benefiting Bitcoin.

Hayes stated that the core variable of the current AI cycle is whether the capital markets have mispriced AI infrastructure, and this assessment will determine the future market direction.