Arthur Hayes, the former BitMEX CEO, warned this week that the global AI arms race is driving a historic surge in fiat credit — and Bitcoin is the main beneficiary. In a new essay, Hayes argued that nation-states treat AI spending as a survival contest, pushing central banks and commercial lenders to fund the build-out indefinitely. He specifically pointed to the US and China, where the Federal Reserve and People's Bank of China have eased financial conditions to support AI infrastructure.
Why bank credit matters now
Hayes noted that so far, most US AI capital expenditure has come from operating cash flow at large software firms like Google and Microsoft. But he claims that source is running out. The next leg, he says, must be funded by bank credit — meaning more money printing and more dollars chasing assets like Bitcoin. Simple Mining echoed that view, describing AI capex as a national-security concern that drives demand for scarce digital assets.
The Jevons Paradox angle
Hayes invoked Jevons Paradox to explain why computing demand keeps accelerating even as model efficiency improves. In plain terms: the cheaper and better AI gets, the more of it people use. That paradox, he argues, ensures the capital flow into AI won't slow down soon — and that keeps the liquidity spigot open for Bitcoin.
Government backing and political stakes
On May 1, the US Department of Defense signed AI deployment deals with eight contractors: Google, Microsoft, Amazon Web Services, Nvidia, OpenAI, Reflection AI, SpaceX, and Oracle. White House AI and Crypto Czar David Sacks estimated that AI capex will deliver a 2% tailwind to US GDP growth this year, possibly over 3% next year, citing Morgan Stanley. Sacks said plainly: 'Stopping progress in AI would be equivalent to halting the US economy.'
Skeptics and the downside risks
Not everyone buys the bullish narrative. Bitcoin advocate Simon Dixon called the sequence a manufactured crisis to justify emergency money creation, saying the US national debt will pay for an AI bailout and energy companies will profit. Hayes himself warned that an oversized AI public offering or merger could end the mania, and anti-AI rhetoric from a 2028 Democratic challenger could pressure capital allocators. Rising electricity and commodity costs may also draw populist backlash heading into the November 2026 US midterms.
Where Hayes sees Bitcoin headed
Hayes says Bitcoin bottomed near $60,000 earlier this year and now believes a return to $126,000 is almost certain. He expects acceleration once the price clears $90,000, driven by short covering. For now, investors are watching AI infrastructure spending, central bank policy, electricity markets, and upcoming technology IPOs for the first signs the cycle is turning.
