Arthur Hayes, co-founder and chief investment officer of Maelstrom, expressed concerns at the Gamma Prime Investing Conference about the excessive investments in AI data centers, which he believes will lead to an oversupply of computing power.
He argues that this overcapacity will result in a market downturn, similar to historical technological rollouts, followed by a bailout that could drive up cryptocurrency values.
Hayes highlighted that major AI companies, including SpaceX and OpenAI, are currently unprofitable, and once the new data centers are operational by late 2027 or 2028, they will face pressure to pay for the computing power they have committed to.
He noted that while some companies in the AI supply chain, like Nvidia, are already profitable, investors need to assess whether they are paying appropriate multiples for future earnings. Hayes also mentioned his new venture, Flop, which aims to create a payments network for AI agents, leveraging the anticipated abundance of computing power.
He believes that if AI agents can directly convert currency into compute, it will enhance their utility and adoption