AI Adoption Will Trigger a Financial Crisis, Potentially Boosting Bitcoin Demand—Hayes

BitMEX co-founder Arthur Hayes has identified the recent divergence between Bitcoin and the Nasdaq as a warning ahead of a massive credit destruction. In his latest , the renowned analyst explained how unfolding events could lead to a financial crisis that will cause the Fed to resort to money printing.

According to Hayes, the imminent money printing, which will lead to a surge in fiat credit, typically boosts Bitcoin’s price. He predicted that the Federal Reserve would embark on increased fiat creation to save the banking system and propel to a new all-time high.

Explaining his position and perspective on the unfolding economic evolution, Hayes noted that the encroachment of AI solutions into the “white-collar” job ecosystem is threatening to disrupt the economic equilibrium. He likened the situation to China’s entrance into the WTO in 2001, which, after seven years, bankrupted the overleveraged US banking system. Hayes linked the 2008 economic collapse in the US to the supply chain disruption caused by the exportation of local manufacturing, following China’s WTO membership.

In the meantime, the renowned analyst predicts that an upcoming financial crisis resulting from AI adoption-driven job losses will trigger another round of economic turmoil. He believes this will happen before the expected boost in productivity, which the government claims will enable it to lower interest rates and reduce the debt load paid for by taxes from corporate profits due to 15% real GDP growth per year.

Hayes thinks the upcoming economic disruption caused by AI adoption will be faster than the effect of China’s entrance into the WTO in 2001. According to him, the current situation is based on data manipulation, a quicker process than the manufacturing era, which involved moving physical equipment. The analyst believes the upcoming disruption will trigger a ripple effect, leading to significant Bitcoin demand over the next few months or years.