Bitcoin Bull Run Fuelled by AI CAPEX and US-Iran War Liquidity
BitMEX co-founder Arthur Hayes argues the crypto bull cycle is being powered by AI CAPEX and the US-Iran war driving faster fiat credit creation. He links the February 28 US attack on Iran to a shift toward “higher for longer” liquidity conditions from the Fed and PBOC, funded by central and commercial bank lending.
The thesis focuses on AI infrastructure costs (data centers, electricity generation) expanding via a compute-and-competition feedback loop, where model complexity rises and prior spending quickly becomes obsolete (Jovan’s Paradox / Red Queen effect). Hayes expects AI CAPEX to keep accelerating unless a major market shock occurs, such as an overly large US/China AI tech IPO or mega-merger, or political pushback against AI-linked inflation in the 2028 US election.
On the macro side, he claims the war threatens commodity and energy supply chains, forcing a “just-in-case” infrastructure and stockpiling shift by sovereign nations—reducing reliance on US treasuries as a source of real-world access to essentials.
For traders, Hayes frames Bitcoin as the clearest beneficiary of expanding dollar/yuan liquidity. He highlights post-February 28 performance versus other risky assets, projecting Bitcoin could retake $126,000 (after reclaiming key levels such as $90,000).
Bullish
Hayes’ article is fundamentally a liquidity-and-macro transmission story: US-Iran conflict is portrayed as accelerating the need (and political will) for fiat credit creation, while AI CAPEX is framed as a long-duration investment cycle funded by central and commercial bank lending. In similar liquidity-expansion regimes, Bitcoin has historically tended to outperform other risk assets when traders reprice the marginal effect of money supply growth.
Short-term, the narrative supports a risk-on bias—especially if markets interpret “Fed/PBOC higher-for-longer liquidity + AI buildout spending” as continuing fuel for BTC. Hayes even points to specific levels ($90,000 breakout area and $126,000 as a target), which can reinforce momentum positioning and options hedging.
Long-term, the same thesis also carries a conditional risk: if an oversized AI IPO/mega-merger shocks the market or if politicians successfully curb AI-linked inflation by restricting credit flows, the liquidity impulse could weaken. Still, until such an “exogenous market event” arrives, the article argues that fiat units and credit growth remain the dominant driver for Bitcoin—keeping the balance of probabilities tilted bullish.