AI Market Overheating May Spill Into Crypto, Says Paolo Ardoino
The rapid expansion of artificial intelligence is creating optimism across global markets, but it may also pose unexpected risks to Bitcoin. According to Tether CEO Paolo Ardoino, an AI-driven market bubble could become Bitcoin’s biggest external risk by 2026, due to the cryptocurrency’s continued correlation with traditional capital markets.
Ardoino believes Bitcoin remains too closely tied to equities, especially U.S. tech stocks. He highlighted concerns that massive investments in AI infrastructure, data centers, GPUs, and power generation may be unsustainable. If AI-related stocks experience a sharp downturn, Bitcoin could face short-term price pressure, even if its long-term fundamentals remain strong. However, he emphasized that extreme crashes like the 80% drawdowns seen in 2018 or 2022 are becoming less likely, largely due to broader institutional and governmental adoption.
Growing participation from pension funds, governments, and large financial institutions is expected to provide Bitcoin with a stronger base. This structural shift may help cushion Bitcoin against severe corrections, even during periods of global market volatility.
Beyond Bitcoin, Ardoino is highly bullish on real-world asset tokenization, especially tokenized securities and commodities, which he expects to scale significantly by 2026. However, he warned that over-institutionalization of Bitcoin could undermine its decentralized ethos if not balanced carefully.
Ardoino expressed a bearish outlook on Europe, citing slow innovation and regulatory frameworks that may hinder crypto growth. He also criticized crypto treasury companies without strong operational businesses, stressing that long-term success requires more than simply holding digital assets.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.