Arthur Hayes has closed out his largest crypto positions — HYPE, NEAR, Worldcoin, and Zcash — and shifted into Treasuries and energy stocks. In a recent podcast, he laid out a macro chain linking oil prices, the Iran conflict, Trump’s midterm election strategy, and AI bubble dynamics, concluding that Bitcoin is unlikely to reclaim $100,000 this year.
Why He Sold: Oil, Trump, and the AI Reflexivity Trap
Hayes believes Trump, facing a likely loss in the 2026 midterms due to high inflation, will pivot against AI to win back voters. The Iran war has choked the Strait of Hormuz, depleting oil reserves and keeping prices high. Hayes argues that “Trump has no ideology — he only cares about winning. AI is unpopular across both parties, so attacking it is a viable political path.” If Trump publicly turns on AI, the bubble will peak, and crypto will follow.
Liquidity Siphoned: Why Bitcoin Underperformed
Hayes revisited Bitcoin’s trajectory since ChatGPT’s launch in November 2022. Despite a surge in global liquidity, Bitcoin peaked at $125,000 last October and then dropped over 50%. His analysis shows that almost all newly created liquidity went into AI: US M2 expanded by ~$1.5 trillion, while AI-related debt issuance totaled an estimated $1.5 trillion, with $1.3 trillion concentrated in 2025-2026. “AI acts as a giant vacuum cleaner for liquidity,” Hayes said. “When the bubble bursts, all assets correlate to 1. Bitcoin won’t escape.”
SpaceX IPO: A $1.8 Trillion Time Bomb
Hayes is bearish on upcoming IPOs from OpenAI, Anthropic, and SpaceX. SpaceX’s valuation of $1.8 trillion implies a price-to-sales ratio of nearly 100x, while its space-based data centers cost four times more than terrestrial alternatives. “Markets are paying 100x sales for a company that’s 4x more expensive and blows up rockets,” Hayes said. He warns that the inflated price makes it nearly impossible to beat expectations, and a disappointing debut could shatter the AI narrative.
Rate Outlook: No Room for Cuts
On new Fed Chair Warsh, Hayes sees a near-zero chance of rate cuts. The 2-year Treasury yield is already 60 basis points above the effective fed funds rate — the market is signaling a need for hikes. “Bubbles hate rising rates,” Hayes noted. “If rate cuts were the pillar supporting AI optimism, that pillar is crumbling.” He now holds Treasuries and ExxonMobil, betting energy is the only safe haven. For crypto, he concluded: “Bitcoin is the best-performing asset in 15 years, but if you entered via ETFs, you’re likely down. I see no positive catalyst ahead.”