Bitcoin price could drop lower before recovering on future money printing, according to Hayes, who says AI bubble has absorbed all liquidity.
Arthur Hayes, the BitMEX co-founder and chief investment officer of Maelstrom, says Bitcoin price may fall with the rest of the crypto market before it benefits from another wave of liquidity.
In a June 8 essay published on BitMEX’s blog, Hayes argued that the AI stock boom has absorbed much of the dollar liquidity that might otherwise have supported Bitcoin and other altcoins.
But if the AI trade breaks, Bitcoin could drop first because investors would be taking losses across risk assets, not rotating cleanly into crypto, the BitMEX co-founder said. He explained:
“Bitcoin cannot rally in the short term if the entire world takes serious losses from the deflation of the AI bubble globally. Eventually, it will bottom, then rise as Bitcoin forecasts an increase in liquidity to put Humpty Dumpty back together again. But right now, it’s about protecting one’s crypto capital.”
Read also: Dave Portnoy Crypto Losses: How Did He Lose so Much Money and Why?
Hayes said he still expects to hold Bitcoin through that period, while also using derivatives for short-term trades. Hayes wrote:
“Because ultimately, I believe that once the AI bubble pops, it will cause a financial crisis that will usher forth the Big Print, I am confident that Bitcoin will dump then pump. I shall hold through the tempest but take some cheeky tactical short positions using derivatives in order to satiate my desire to trade. I’m still a certified degen.”
But the new call also comes from a trader who just had to eat his last Bitcoin forecast after saying BTC▼$61,456.00 wouldn’t see $60,000 again.
Just in mid-May, Hayes claimed that Bitcoin “bottomed earlier this year at $60,000, and with a tailwind of trillions of dollars and yuan yet to be created at its back, retaking the $126,000 is a foregone conclusion.”
Now, Hayes acknowledged that miss in the essay, writing, “Yes, I know I proclaimed we wouldn’t see $60,000 Bitcoin again, and obviously I erred, but that’s forecasting for you.”
AI Bubble Everywhere
Bitcoin’s rally since the 2022 FTX collapse has been strong, but weaker than it might have been because AI stocks pulled capital away from crypto, Hayes argues, pointing to the commercial release of ChatGPT in late 2022 as the start of what he called the “great AI bubble.”
Now, Hayes claims Maelstrom, his family office and investment firm, has moved toward energy producers and away from most non-core crypto positions.
Hayes said he sold HYPE▼$59.66, the token tied to Hyperliquid, NEAR▼$2.10, the token tied to Near Protocol, WLD▲$0.5212, the token tied to Worldcoin, and ZEC▲$461.08, the token tied to Zcash, last week, a disclosure that drew backlash because he had publicly pushed bullish calls on some of those tokens shortly before exiting.
He noted that he still keeps Bitcoin and Ethereum even though describitng ETH▼$1,640.54 as “dead but functional.”
Read more: ETH Price Hits 2025 Levels as Failed Ethereum Debate Returns
