Arthur Hayes Predicts Bitcoin Surge to $126K After $60K Bottom

Bitcoin could rally above $126,000 as AI spending, war costs, and rising liquidity boost crypto markets, according to Arthur Hayes.

Arthur Hayes released a new essay called The Butterfly Touch this week. In the report, He said that as the infrastructure investment in AI continues to increase and geopolitical tensions grow, more capital may flow into financial markets. As a result, he believes Bitcoin may enter another powerful bull run soon.

AI Spending and War Costs Could Fuel Bitcoin Rally

The crypto entrepreneur said Bitcoin already formed a bottom near $60,000 earlier this year. Moreover, he said the digital asset would likely surpass the $126,000 mark in the future. The report suggests that the market could gain significant momentum if Bitcoin breaks above the crucial $90,000 mark.

The essay linked Bitcoin growth to global investment in AI. Both the United States and China are heavily funding artificial intelligence projects. Thus, governments and banks can keep printing more dollars and yuan to finance technology infrastructure and electricity production.

The report also correlated the increase in military spending with the increase in liquidity in the global markets. Governments are investing more in the military and creating new infrastructure systems. The war spending and AI expansion could thus add to inflationary pressures and drive up crypto prices.

The essay suggests that central banks can maintain loose financial conditions for a number of years. The more fiat money that enters the global economy, the better it will be for limited goods such as Bitcoin. The report said that in previous cycles, increased liquidity was a positive factor for the crypto markets to rally.

The BitMEX co-founder also said that many countries could decrease their reliance on U.S. Treasury holdings. Instead, nations could invest more money into commodities, energy security, food supply chains, and local infrastructure projects.

Bitcoin Could Gain Momentum Above $90,000

The report noted that Bitcoin has recently performed better than several key assets due to rising geopolitical tensions earlier this year. However, there are still several traders who are not convinced about the cryptocurrency market. But the essay said that at some point, improving liquidity conditions could alter investor sentiment.

The crypto investor cautioned that the quick AI investment may lead to economic instability down the road. Expensive investments in data centers, electricity generation and machine intelligence could drive up prices around the world. But the current market conditions remain favorable for risk assets and cryptocurrencies.

The essay also noted that political opposition to the growth of AI may intensify in the run-up to the 2028 presidential election in the United States. Inflation and automation worries could be significant campaign concerns. The report said, however, that these political risks are not likely to end the current liquidity cycle right away.

Privacy-Focused Crypto Projects Expected to Lead Future Market Cycles

Currently, the investor’s family office, Maelstrom, has significant holdings of HYPE and ZEC. Besides, the report also named NEAR as the next big crypto project to deploy. The essay proposed that in the future, blockchain technologies that focus on privacy will receive more attention in the market cycles.

Another potential upside for U.S. energy producers was oil prices near $100. The report said that continued expansion of the economy could be sustained by higher commodity prices and more infrastructure investment. This means that there is still plenty of room for the crypto market to grow in the future.

The latest comments were picked up by many social media platforms, drawing attention to the crypto community. As the liquidity grows, Bitcoin’s long-term prospects are expected to improve, according to supporters. In the meantime, there are still doubts about the ability of increased investment in AI and geopolitical tensions to maintain another big crypto bull market.

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