Arthur Hayes Predicts Bitcoin to Return to $126,000 Amid U.S.-China AI Arms Race and War Inflation

According to Odaily, Arthur Hayes published an article titled “The Butterfly Touch” on May 12 predicting that Bitcoin will return to $126,000 as a result of U.S.-China AI capital expenditure competition and war-driven inflation. Hayes stated that the crypto bull market officially launched after the U.S. military action against Iran on February 28, 2026, with Bitcoin having already formed a base around $60,000. He expects accelerated gains following a break above $90,000.

Hayes identified three drivers of fiat currency credit expansion: U.S.-China AI competition for national security, war inflation from the U.S.-Iran conflict reshaping global supply chains, and the Trump administration’s political incentive to maintain loose credit and rising capital markets ahead of the 2028 U.S. election.