Hayes Ditches AI for ETH Amidst Market Crowding-Out Effect

Arthur Hayes, co-founder of BitMEX, has shifted his focus to Ethereum in this new era. He believes that the AI sector is absorbing all the fresh money injected into the market, creating a crowding-out effect in crypto assets.

Hayes pointed out that since ChatGPT achieved commercial success in November 2022, AI-driven borrowing and capital expenditures have reached trillions of dollars. He noted that AI spending nearly doubled in 2026 following Bitcoin's peak in 2025.

'AI has seized the marginal dollar,' Hayes said. 'There's no cash left to invest in crypto. Investors are opting for AI, the fastest horse right now, to prevent their money from losing value.'

However, Hayes predicts that this situation is unsustainable and expects a major 'AI collapse' within the next 3 to 5 years.

He cited factors such as open-source models from China offering services at 1% of San Francisco prices and the rapid obsolescence of hardware (GPUs) as contributing to the bubble's bursting.