Bitcoin has climbed more than 31% from its February 6 low of $62,822. The article says it was trading near $81,000 on Wednesday, with a seven-day range between $79,467 and $82,496. Arthur Hayes argues that, since February 28, Bitcoin has outperformed other risk assets including gold and major US technology stocks.
AI spending and policy easing form Hayes’ macro case
Hayes ties the move to the rivalry between the United States and China in AI. In his view, both governments are loosening financial conditions under the banner of national security, putting more money into circulation while allowing banks to expand lending. He describes that mix as a strong backdrop for crypto markets. The piece also says annual capital expenditure tied to AI and electrification is growing quickly, adding to the stock of fiat money in the system.
Analysts cited in the article say the effect reaches both traditional finance products and digital assets, but cryptocurrencies, especially Bitcoin, tend to react faster to changes in liquidity. Hayes is quoted as saying that there will be even more fiat currency in circulation, and that the pace of change is accelerating as AI and electrification spending rises.
Conflict, domestic spending, and credit expansion
Hayes also points to the ongoing conflict involving Iran. He says it has created inflation pressure and encouraged countries to favor domestic infrastructure spending over purchases of US Treasury bonds or equities. Combined with higher military expenditures, that pattern is, in his view, speeding up money creation. His argument is that the political push to win the AI race, paired with newly printed money and expanded bank credit, is supportive for crypto assets.
The article notes that Hayes had said in March that the Federal Reserve might loosen monetary policy more to help finance the conflict involving Iran. He viewed that possibility as positive for crypto.
Bitcoin outpaces gold as traders watch higher levels
The article says the crypto market set a series of highs in 2023, with total market capitalization reaching $4.28 trillion in October. After a pullback later in the year, investors have remained divided on when a lasting recovery may take hold. Over the same recent stretch, gold rose by about 2%, moving from $4,581 to $4,710, far below Bitcoin’s gain.
Hayes says Bitcoin, after falling to $60,000 at the start of the year, could revisit what the article describes as its historic high of $126,000 if trillions of new dollars and yuan enter the global economy. The piece also cites recent CryptoAppsy figures showing that Bitcoin’s momentum is pushing investors to look toward record highs again.