Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom, released a new essay titled “The Butterfly Touch” this week, laying out a bullish case for Bitcoin. He predicts the cryptocurrency has already bottomed near $60,000 and is poised to surge past $126,000 as a massive influx of fiat liquidity—fueled by artificial intelligence infrastructure spending and rising geopolitical tensions—floods global markets.
Hayes argues that the U.S. and China are locked in an AI arms race that is moving beyond the ability of large tech firms to self-finance. The next phase, he contends, will require credit channels involving the Federal Reserve, the People’s Bank of China, and commercial banks. China has already begun steering banks from real estate lending toward technology financing, while the U.S. backs data center buildouts and expanded electricity production. “Central or commercial banks will provide the capital the tech bros require,” Hayes writes, predicting that accelerating AI and electrification capital expenditures will create “vastly more units of fiat tomorrow than today.”
The essay connects this liquidity creation directly to Bitcoin’s bull run. Hayes highlights the earlier American bombing of Iran on February 28 as a catalyst, noting that since that date Bitcoin has outperformed gold, the Nasdaq 100, the IGV ETF, and U.S. tech stocks. He says the asset has bottomed at $60,000 and could rally excessively beyond $90,000 due to call seller covering, with upside toward $126,000 and no clear top. “I have no fucking idea how high Bitcoin can go,” he states, adding that Maelstrom’s portfolio is positioned for maximum risk.
Beyond AI, Hayes points to war-driven supply-chain fears and a potential retreat from dollar-denominated assets. Nations that relied on American hegemony may begin dumping U.S. Treasuries to fund concrete assets like pipelines, food storage, fertilizers, and local defense. To prevent destabilization, the U.S. could deploy dollar swap lines and ease eSLR requirements, further loosening financial conditions. Loose monetary policy, combined with inflation from AI and military spending, creates a favorable environment for limited-supply assets like Bitcoin.
Hayes also forecasts political blowback: by the November midterms, voters hurt by inflation and AI-driven job losses could turn hostile, and a 2028 Democratic candidate might campaign against AI. Yet he believes these risks will not derail the current liquidity cycle in the near term. The essay additionally mentions Maelstrom’s significant holdings in HYPE and ZEC, and names NEAR as a key project, though its core thesis revolves around the macro forces propelling Bitcoin higher.
