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Arthur Hayes: If AI Collapses, the US May Have to Print More Money, Bitcoin Will Benefit.
BitMEX co-founder Arthur Hayes believes that a severe downturn in the artificial intelligence (AI) sector could force the US government to intervene to support the credit market, thereby increasing USD liquidity and creating a positive momentum for Bitcoin.
In his latest essay titled “Safety First,” Arthur Hayes focuses on analyzing the recent cautious moves by major AI companies like Anthropic and OpenAI in the development of artificial general intelligence (AGI).
According to Hayes, the slowdown in AI labs’ development or the restriction of certain investments for safety reasons may not entirely reflect technical issues. He suggests that a deeper reason could be that the demand for AI at current prices may not be as strong as expected.
If AI companies begin to cut spending on model training activities, the consequences could spread across the entire AI infrastructure chain. Investments in data centers, servers, and AI processing chips could come under pressure as the pace of computing demand expansion slows.
Hayes particularly notes the scale of credit being used to finance the wave of AI infrastructure investment. According to his argument, over $1 trillion in investment-grade debt and hundreds of billions of dollars in lower-quality credit loans are related to the construction and expansion of AI infrastructure.
In the event that AI demand significantly weakens, these investments could pressure debt repayment capabilities and the value of collateral. When cash flow from business activities is insufficient to meet financial obligations, credit risk could spread to lenders, bond investors, and insurance companies holding AI-related debt.
Hayes suggests that this could be the point where AI issues transition from a tech industry growth story to a problem for the entire financial system.
According to the scenario he presents, if the AI-related credit market faces severe stress, the US government may have to intervene to prevent a domino effect. One possibility is that the government becomes the “buyer of last resort” for compute, thereby maintaining demand for computing power and AI infrastructure even as the private sector begins to cut spending.
Another possibility is government support for insurance companies affected by AI-related debt. In both cases, Hayes believes that the ultimate policy response could lead to increased USD liquidity in the financial system.
This is the factor that makes Hayes optimistic about Bitcoin in the event of a major shock in the AI market.
His argument is not that a weakening AI will directly cause Bitcoin to rise in price. Instead, the scenario Hayes presents is that a credit crisis due to AI could force authorities to implement financial and monetary support measures. If these measures increase USD liquidity, Bitcoin and other crypto assets could benefit from a more relaxed monetary environment.
This also aligns with Hayes’ long-standing view that global liquidity is one of the key factors affecting Bitcoin’s performance. In this approach, Bitcoin is seen not only as a tech asset but also as an asset that can benefit when the financial system enters a monetary expansion cycle.
