Arthur Hayes, co-founder of the investment firm Maelstrom, stated this week that large-scale investment in artificial intelligence infrastructure could lead to overcapacity and a subsequent market correction. Speaking at the Gamma Prime Investing Conference, the former BitMEX CEO said he believes a resulting financial bailout would create market conditions that benefit cryptocurrencies.
According to Hayes, current spending on AI-related data centers represents a misallocation of capital. “Humanity is ’wasting multi-trillion dollars’ on building AI data centers,” he said in response to questions at the event.
Hayes based his view on historical patterns observed in previous technological developments. “If you study financial history and you study every single major technological rollout, it always is overbuilt. There always is a crash, and there always is a bailout,” he stated.
He identified late 2027 or 2028 as a potential timeframe for a market test, when newly constructed data center capacity becomes operational and clients face payment commitments for computing power. Hayes mentioned companies including SpaceX, OpenAI and Anthropic as current drivers of demand for this infrastructure.
In his remarks, Hayes connected a potential downturn in the AI sector to the cryptocurrency market. He argued that a government or central bank bailout, aimed at stabilizing the market after a crash, would increase liquidity in the financial system. “Thankfully, we have bitcoin and other crypto to soak up that excess liquidity, and so we know the asset that’s going to perform the best when the bailout comes,” Hayes said. “You just have to be patient.”
He also addressed the current profitability within the sector, noting that while some suppliers like Nvidia and memory chip manufacturers are profitable, the primary end-users of the technology are not. The “bull case,” according to Hayes, is that AI applications become sufficiently useful and widespread in the next year to allow these companies to achieve profitability and meet the growing supply of computing power.
During the conference, Hayes also announced a new venture named Flop, an AI-agent payments project scheduled to launch in the first quarter of 2027. The project is based on the premise that the AI buildout will make computing power inexpensive and widely available. Flop aims to establish a spot market for computing power, where providers are compensated with the project’s own token.
“If agents can convert a currency directly into compute, which is what they eat and consume, then they will use this currency,” Hayes said, explaining the project’s objective.
