The market is starting to feel like 1999 all over again. Here’s an unsentimental appraisal of whether AI is a bubble ready to burst or a revolution that’s just beginning.Generated By Google AI Studio It’s September 2025, and if you’re a trader, you can feel it in the air. AI stock mania is rampant. Companies are hitting trillion-dollar valuations, every startup is becoming an “AI company”, and the hysteria bears a striking similarity to the dot-com hysteria in the late 90s. From my office here in Karachi, watching the global markets, I’m grappling with the same question that every other trader is grappling with — Is it a huge AI bubble waiting to pop, or is it the initial tremor of a seismic real AI revolution that will remake our world? In reality, it’s not a simple “either/or” type of answer. The right way to approach the market for the rest of 2025 and into 2026 is to realize it is both. The Case for a Bubble: The Dot-Com Echoes Let’s be honest, the arguments for a bubble are strong. It’s easy to see the comparison between the dot-com bubble and the AI boom.Generated By Google AI Studio Insane Valuations: We are witnessing firms with outrageous price-to-earnings ratios that appear divorced from reality. The market is pricing in decades of flawless growth, a telltale symptom of speculative fever. Hype Begets Reality: For every firm with a genuine AI product, ten others have merely appended “AI” to their promotional materials to inflate their stock price. Such a rush to capitalize on the hype is an enormous red flag. FOMO-Investing: A substantial amount of money is being invested in AI stocks, not due to thorough analysis, but rather due to the fear of missing out. This type of emotional investing is the rocket fuel that goes into every market bubble. The Case for a Revolution: This Time It’s Different Although the hype is legitimate, it is a fallacy to write off the entire phenomenon. There are underlying reasons why this is not just the 1999 repeat. It’s Already Profitable: Unlike during the dot-com bubble, when the majority of companies were pre-revenue, the titans of the AI space (such as NVIDIA, Microsoft, and Google) are already making billions of dollars in actual, real profit from their AI businesses today. It’s a “Layer,” Not Just a “Product”: The internet was a new product. AI is a new underlying layer, similar to electricity. It won’t only establish a new industry; it will be embedded in every industry, from healthcare to farming. That’s the distinction between a market bubble and a revolution in technology. Real-World Adoption is Happening Now: This isn’t a vision for some far-off tomorrow. Consumers and businesses are already using AI technology today to an extent that surpasses early internet adoption. The Judgement: It’s a Revolution Inside of a Bubble So what’s the actual answer? Both. The underlying technology is indeed revolutionary. However, the stock prices of some of the companies involved have been driven by hype into a speculative bubble. The revolution is the long-term trend, the bubble is the short-term mania of the market. The challenge for traders and investors is to learn to tell the difference. The Playbook for the Rest of 2025 So what should you be thinking about the market as we look towards 2026? This is not investment advice, but a strategic guide.Generated By Google AI Studio 1. Think About the “Picks and Shovels” In a gold rush, the safest bet is to sell shovels and picks. In the AI revolution, it means investing in the firms that offer the infrastructure everyone else requires. Consider chip manufacturers, data center operators, and cloud computing platforms. They’ll win regardless of which particular AI application triumphs. 2. Learn How to Identify an Overvalued AI Stock Don’t invest in a stock solely because it has “AI” in its name. Observe the fundamentals. Is its top line increasing? Is it profitable? A company with a wonderful story and no income is a speculative gamble, not a good investment. 3. Have an Exit Strategy Markets will correct , or even a revolution. What will the market do once an AI bubble pops? The top companies will survive and thrive, but many of the hyped-up companies will blow up. Know what your risk tolerance level is, use stop-losses, and do not be afraid to take profits on stocks that have had a great run-up. Conclusion: Respect the Bubble, Don’t Worry About It The AI revolution is upon us and still in its nascent phase. For those looking down the road, investing in AI is likely the defining opportunity of the decade. But in the meantime, we’re immersed in a hype and easy money bubble. As traders, it isn’t wise to worry about the bubble; rather, respect it. If you focus on quality, remain nimble, and separate noise from signal, you can enjoy the volatility and position yourself for some staggering shifts to come. What do you think of the AI market? Buying, selling, or sitting on the sidelines? Follow me for more honest analysis of the financial markets. Clap & share if this helped — it keeps me motivated to share more free guides. AI Bubble or Revolution? What Traders Need to Know Before 2026 was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this storyThe market is starting to feel like 1999 all over again. Here’s an unsentimental appraisal of whether AI is a bubble ready to burst or a revolution that’s just beginning.Generated By Google AI Studio It’s September 2025, and if you’re a trader, you can feel it in the air. AI stock mania is rampant. Companies are hitting trillion-dollar valuations, every startup is becoming an “AI company”, and the hysteria bears a striking similarity to the dot-com hysteria in the late 90s. From my office here in Karachi, watching the global markets, I’m grappling with the same question that every other trader is grappling with — Is it a huge AI bubble waiting to pop, or is it the initial tremor of a seismic real AI revolution that will remake our world? In reality, it’s not a simple “either/or” type of answer. The right way to approach the market for the rest of 2025 and into 2026 is to realize it is both. The Case for a Bubble: The Dot-Com Echoes Let’s be honest, the arguments for a bubble are strong. It’s easy to see the comparison between the dot-com bubble and the AI boom.Generated By Google AI Studio Insane Valuations: We are witnessing firms with outrageous price-to-earnings ratios that appear divorced from reality. The market is pricing in decades of flawless growth, a telltale symptom of speculative fever. Hype Begets Reality: For every firm with a genuine AI product, ten others have merely appended “AI” to their promotional materials to inflate their stock price. Such a rush to capitalize on the hype is an enormous red flag. FOMO-Investing: A substantial amount of money is being invested in AI stocks, not due to thorough analysis, but rather due to the fear of missing out. This type of emotional investing is the rocket fuel that goes into every market bubble. The Case for a Revolution: This Time It’s Different Although the hype is legitimate, it is a fallacy to write off the entire phenomenon. There are underlying reasons why this is not just the 1999 repeat. It’s Already Profitable: Unlike during the dot-com bubble, when the majority of companies were pre-revenue, the titans of the AI space (such as NVIDIA, Microsoft, and Google) are already making billions of dollars in actual, real profit from their AI businesses today. It’s a “Layer,” Not Just a “Product”: The internet was a new product. AI is a new underlying layer, similar to electricity. It won’t only establish a new industry; it will be embedded in every industry, from healthcare to farming. That’s the distinction between a market bubble and a revolution in technology. Real-World Adoption is Happening Now: This isn’t a vision for some far-off tomorrow. Consumers and businesses are already using AI technology today to an extent that surpasses early internet adoption. The Judgement: It’s a Revolution Inside of a Bubble So what’s the actual answer? Both. The underlying technology is indeed revolutionary. However, the stock prices of some of the companies involved have been driven by hype into a speculative bubble. The revolution is the long-term trend, the bubble is the short-term mania of the market. The challenge for traders and investors is to learn to tell the difference. The Playbook for the Rest of 2025 So what should you be thinking about the market as we look towards 2026? This is not investment advice, but a strategic guide.Generated By Google AI Studio 1. Think About the “Picks and Shovels” In a gold rush, the safest bet is to sell shovels and picks. In the AI revolution, it means investing in the firms that offer the infrastructure everyone else requires. Consider chip manufacturers, data center operators, and cloud computing platforms. They’ll win regardless of which particular AI application triumphs. 2. Learn How to Identify an Overvalued AI Stock Don’t invest in a stock solely because it has “AI” in its name. Observe the fundamentals. Is its top line increasing? Is it profitable? A company with a wonderful story and no income is a speculative gamble, not a good investment. 3. Have an Exit Strategy Markets will correct , or even a revolution. What will the market do once an AI bubble pops? The top companies will survive and thrive, but many of the hyped-up companies will blow up. Know what your risk tolerance level is, use stop-losses, and do not be afraid to take profits on stocks that have had a great run-up. Conclusion: Respect the Bubble, Don’t Worry About It The AI revolution is upon us and still in its nascent phase. For those looking down the road, investing in AI is likely the defining opportunity of the decade. But in the meantime, we’re immersed in a hype and easy money bubble. As traders, it isn’t wise to worry about the bubble; rather, respect it. If you focus on quality, remain nimble, and separate noise from signal, you can enjoy the volatility and position yourself for some staggering shifts to come. What do you think of the AI market? Buying, selling, or sitting on the sidelines? Follow me for more honest analysis of the financial markets. Clap & share if this helped — it keeps me motivated to share more free guides. AI Bubble or Revolution? What Traders Need to Know Before 2026 was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story