Bitcoin’s Value Tied To AI’s Energy Appetite: Arthur Hayes

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July 9, 2023 by Aishwarya shashikumar

Arthur Hayes, the former CEO of Bitmex and current manager of Maelstrom, a family office, strongly believes that Bitcoin is the ideal currency for artificial intelligence (AI) systems due to its digital nature, anti-censorship features, and limited supply.

In his most recent blog post, Hayes suggests that the decentralized structure of the BTC network and the autonomy it offers to users align with the potential characteristics of future AI economies.

Hayes argues that BTC’s value is closely linked to the cost of electricity, which he refers to as the “food of AI.” This relationship makes Bitcoin a reliable and efficient store of value for AI systems over extended periods. In fact, Hayes goes as far as claiming that Bitcoin represents the closest monetary instrument to pure energy.

Furthermore, Hayes asserts that BTC’s scarcity and resistance to censorship provide AI-based technologies with an advantage over other forms of currency. While the supply of gold and fiat currencies can fluctuate, BTC’s supply is cryptographically limited, offering a predictable financial foundation that cannot be manipulated.

AI Economy’s Impact On Bitcoin’s Value

Hayes highlights the potential collision between the rising interest in BTC and the growing adoption of AI. He suggests that the desire to escape inflation within the fiat system, combined with the aspiration to participate in the next phase of human and computer evolution, could result in a fusion of two separate investment frenzies. This convergence might lead investors to overvalue Bitcoin’s growth, driving its value to excessively high levels.

Based on his predictive model, Hayes forecasts that the AI economy could represent between 5% and 50% of global GDP by 2025 or 2026. Such a scenario could trigger a significant surge in BTC’s value, potentially reaching $760,000 per coin. Hayes considers this period as the prime opportunity for long-term Bitcoin investors as market assumptions shift from “impossible” to “possible.”

While uncertainties surround the future of AI and Bitcoin, Hayes expresses his intention to embrace the narrative hype surrounding these technologies and capitalize on it.

In May, Hayes had already anticipated a volatile year for Bitcoin in 2023, followed by a robust rally starting in 2024.

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