Bitcoin dropped toward $83,800 as about $403.58 million in leveraged crypto long positions were wiped out within an hour. The liquidation wave highlights the market’s current risk-off conditions and comes against Arthur Hayes’s broader view that an eventual AI-related credit crisis could lead to a bailout and inject new liquidity into crypto markets.
Hayes’s thesis centers on the enormous expansion of AI data centers. He argues that the spending boom could initially hurt risk assets, but a financing crisis severe enough to force government intervention could eventually produce the liquidity that Bitcoin benefits from.
The size of the AI infrastructure buildout makes its funding structure a major concern. Estimates cited in the report suggest U.S. AI infrastructure spending could range from $2.8 trillion by 2030 to $10.3 trillion by 2032. Credit platform Atrium estimates that developers have already taken on at least $1.3 trillion in debt to finance the expansion.
Hayes is focused not only on how much companies are spending but also on whether the economics can support that spending. His concern is that the industry could end up with abundant and inexpensive computing capacity while infrastructure providers remain burdened by large financial commitments tied to customers paying for reserved capacity.
SpaceX, OpenAI and Anthropic are among the companies expected to drive demand for computing power. Hayes has pointed out that none of them is currently profitable. Columbia economist Stijn van Nieuwerburgh estimated that earning a 10% return on the infrastructure investment would require around $3.7 trillion in annual revenue by 2032.
The gap between the cost of building infrastructure and the ability of customers to generate enough revenue is central to Hayes’s argument. He expects the real test to arrive once the new computing capacity is delivered, potentially in late 2027 or 2028. High demand for AI computing today does not guarantee that every infrastructure project will produce enough returns to cover its financing costs.
The potential Bitcoin impact would emerge further down the line. Hayes expects a credit crisis to eventually force a bailout, with the resulting liquidity potentially flowing into crypto. That scenario requires two things: significant financial stress must develop, and policymakers must respond with measures that expand liquidity.
Bitcoin’s recent decline illustrates the risks already present in the market. The report placed BTC about 33% below its October 2025 record of $126,000. The $403.58 million in long liquidations recorded as Bitcoin approached $83,800 shows how quickly leverage can intensify a sell-off, although the figure alone does not identify a price bottom or indicate how far another decline could go.
A major credit shock could initially have the opposite effect of Hayes’s eventual bullish case for Bitcoin. Investors could reduce risk, prices could fall and leveraged positions could be forcibly closed, creating additional selling pressure. Bitcoin would still be vulnerable to those dynamics even if it later benefited from a liquidity-driven policy response.
Hayes’s overbuild argument would weaken if AI companies successfully pay for the computing capacity they have committed to and infrastructure investments generate sustainable returns. But if customers struggle to meet those obligations when new capacity comes online in late 2027 or 2028, Hayes believes the resulting financial stress could trigger a credit crash and eventually a bailout.
Even then, the Bitcoin thesis is not automatic. The downturn would need to be severe enough to prompt intervention, and the resulting policy response would need to create liquidity that reaches crypto markets rather than simply repairing the traditional credit system.
Federal Reserve policy expectations and inflation data could further influence liquidity conditions and investor appetite for risk, adding another layer of uncertainty to the path from an AI-related credit shock to Bitcoin.
For now, Hayes’s argument should be viewed as a longer-term macro scenario rather than an immediate Bitcoin trading call. If excessive AI infrastructure spending eventually creates financial stress and leads to a liquidity-heavy bailout, Bitcoin could emerge as a beneficiary. Until those developments materialize, the immediate lesson is that high leverage continues to leave crypto markets vulnerable to sharp moves.
