How AI, inflation, and scarcity are driving Bitcoin into its strongest bull run.

Author: Jordi Visser, Senior Analyst on Wall Street; Translated by: Shaw Jinse Finance

Some significant things are happening right now, and I believe this marks the beginning of the next phase of Bitcoin's market movement. For years, one of the biggest questions investors have had is simple: Bitcoin behaves like a risk asset. It fluctuates with the tech sector, and rises and falls with the software industry, market liquidity, and speculative sentiment. As long as this holds true, many investors prefer to stay within the fiat currency system and hold large-cap tech stocks. They don't need Bitcoin because the best-performing assets are still built on code, tied to traditional markets, and exist within the existing financial system.

This correlation is beginning to change. For most of the past three years, Bitcoin has been highly correlated with the software industry and has had to compete with short-term yields that outpace inflation. In this environment, investors could earn real returns by holding cash while also holding core growth stocks in the technology sector. Bitcoin could only struggle to gain attention. Even during its upward phase, many treated it as a secondary asset, not a core macro asset. Now, this格局 (structure/pattern) is crumbling. Bitcoin is beginning to decouple from the software sector, which itself is facing increasing pressure from the exponential growth of artificial intelligence (AI). This is crucial because it completely transforms Bitcoin's positioning in the minds of investors: Bitcoin is the only mainstream growth asset built on code that can benefit from, rather than be threatened by, the development of AI. This shift is key to the entire core logic. The software industry is facing a truly disruptive cycle. The Mythos model shifted the market discourse, forcing investors to consider: what happens when AI models move beyond incremental optimization and achieve leaps in capabilities? The industry challenges extend beyond software profit margins or corporate budgets, encompassing labor, knowledge-based jobs, cybersecurity risks, pricing power, and the sustainability of business models built for the previous generation of code. AI agents are accelerating this process, as they go beyond simply generating answers; they search, plan, negotiate, write code, and increasingly perform actions autonomously. This changes the pricing logic for software, the value of labor, and which parts of the traditional technology stack deserve a premium valuation. Bitcoin, however, is unaffected by this pressure because it is not a software company. It doesn't rely on user growth, pricing power, profit margins, or corporate spending. It is a digital scarcity asset. In a market reassessing all code-based assets, Bitcoin may be the only code-based asset that will become even stronger with the advancement of AI. This is a profound shift, as investors have viewed Bitcoin as an extension of the technology sector for years. What if the situation were exactly the opposite: that this digital asset actually benefits as exponential AI undermines other code-based economies? This is the first reason I believe we are entering a Bitcoin-exclusive cycle. The second reason lies on the macro level. A new wave of inflation appears imminent, while labor market momentum is weakening. This combination creates a policy dilemma for central banks. When inflation rises and the employment environment deteriorates, the Federal Reserve's room for aggressive inflation control shrinks significantly. It can only pause rate hikes, hesitate, and ultimately lean towards easing in an environment of continuously depreciating purchasing power. Historically, it is against this backdrop that Bitcoin has begun to move independently. The key signal is clear: the year-on-year CPI is about to exceed the 3-month Treasury yield. In other words, short-term real interest rates are about to turn negative again. Historically, this dividing line has been an important indicator of Bitcoin's performance. When cash yields exceed inflation, investors can hold short-term instruments to maintain purchasing power, forcing Bitcoin to compete with real yields. When inflation surpasses short-term yields, the situation reverses rapidly: cash ceases to function as a true store of value, and the seemingly safest nominal asset begins to underperform inflation. At this point, funds begin seeking alternatives. Based on my frequently used analytical framework, Bitcoin's strongest bullish cycles occur when the year-on-year CPI is higher than the 3-month Treasury yield, and the Federal Reserve pauses rate hikes or shifts towards easing. Within this range, Bitcoin's annualized return has exceeded 200%. We are now very close to this window. This is not a trivial macroeconomic detail, but rather the most favorable macroeconomic environment Bitcoin could experience.

What is particularly crucial now is that the reasons for this round of inflationary resurgence are completely different from the previous cycle. This is not a simple economic rebound, nor is it a temporary supply and demand imbalance in commodities. The root cause of rising inflation lies in the increasingly unstable demand for physical resources in the real economy, while artificial intelligence has significantly increased the demand for real-world production factors. Energy, electricity, computing power cooling, semiconductors, memory chips, power grid equipment, industrial metals, transportation, packaging, and logistics have all become core drivers of growth. Artificial intelligence should have been a story about software, but it has now evolved into a story about scarcity. The higher the level of intelligence integrated into the economic system, the greater the physical production capacity required to support it. This means that technologies once considered by investors to only lead to oversupply are now exacerbating inflationary pressures. The wave of creative destruction has been evolving in this direction for decades. Each wave of innovation makes the system more efficient, more deflationary, and more unequal by making capital returns superior to labor returns. This is also a major reason for the current global wealth distribution problem. Whenever deflation and unemployment threaten the economic system, central banks respond in a consistent manner: **cutting interest rates, releasing liquidity, launching quantitative easing, and stimulating demand in an attempt to offset the deflationary effects of technological change**. This approach has been effective in previous cycles, but it will fail against artificial intelligence. The power of this wave of technology far exceeds that of the past. People's purchasing power is already stretched thin, and policymakers now face a contradiction that is not easily resolved. While artificial intelligence (AI) creates deflationary pressures in the labor, software, and knowledge work sectors, it simultaneously drives up inflation in the real economy through electricity, commodities, cooling equipment, chips, and infrastructure. In other words, the same force is both depressing wages and jobs and raising the global cost structure necessary for its own development. Central banks can print money, but they cannot print copper, electricity, fertilizer, or stable purchasing power. These can support markets, but they cannot prevent exponential intelligence from disrupting the labor market. This is the unique aspect of this policy dilemma. Technological deflation and scarcity inflation are arriving simultaneously, and the traditional toolbox of quantitative easing is no longer suitable for this new world. And remember, humanoid robots will soon enter our lives; everything we are seeing now is just the beginning. With the emergence of the Mythos model, this logic has an increasingly important layer of meaning: the inherent fragility of the fiat currency system. For years, critics have viewed quantum computers as a threat to the future of Bitcoin. The current pressure stems from a more pressing direction. Mythos has drawn market attention to the risks of hacking and cybersecurity vulnerabilities within the existing financial architecture. The U.S. Treasury Department urgently convened a meeting of bank executives, and Anthropic spearheaded the Glasswing program to address the risks faced by businesses. These are significant moves, demonstrating that exponential AI is forcing institutions to confront the potentially enormous exposure risks within the financial system. If banking systems, payment channels, software architecture, and core digital infrastructure become increasingly vulnerable in an era of rapid AI model iteration, the security of the fiat currency system will fall far short of investor expectations. This represents a major shift in perception. Bitcoin was designed for a world where centralized systems have collapsed. The more artificial intelligence exposes the vulnerabilities of these systems, the more prominent Bitcoin's value becomes. Discussions about security are shifting from abstract future risks to current systemic vulnerabilities in institutions. This is what I have repeatedly emphasized—Bitcoin is the purest form of artificial intelligence trading instrument. This might sound counterintuitive, as Bitcoin is often discussed separately from semiconductors, data centers, robotics, or cloud computing infrastructure. However, the deeper connection lies in macroeconomic logic. **Artificial intelligence is reshaping the economy around scarcity, instability, and exponential change, forcing large-scale physical investment, increasing commodity consumption, and boosting electricity demand, while simultaneously transforming the underlying software.** Bitcoin stands precisely at the intersection of these forces: it benefits from negative real interest rates, market distrust of the fiat currency system, the fact that scarcity is more valuable than oversupply, and a world where nominal security is rapidly diverging from real purchasing power. There is also an important dimension underestimated by investors: **network effects driven by stablecoins.** Bitcoin already possesses one of the most powerful networks in the financial sector, is the most widely accepted store of value in the digital economy, and boasts the deepest liquidity, the broadest global recognition, the strongest institutional acceptance, and the most secure decentralized currency network. AI agents will further strengthen this advantage. When intelligent agents begin to transact, settle value, allocate capital, procure services, and interact with each other across platforms at machine speed, they will prioritize assets with the deepest liquidity, clearest monetary rules, highest operational stability, and widest acceptance. Network effects are continuously amplified through trust, scale, and interoperability, and Bitcoin possesses unique advantages in all three aspects. In a world where intelligent agents and humans participate in economic activities together, the Bitcoin network will become even more powerful because it provides a neutral, global, and highly liquid value channel that is acceptable to both humans and machines. Most importantly, AI intelligent agents will not be bound by the path dependence of the traditional fiat currency system; they will make choices based on optimal decision-making, which will ultimately benefit Bitcoin to the greatest extent. All of this is important because the rise of AI intelligent agents may create a completely new dimension of economic activity. We are moving towards a world where software no longer merely recommends or analyzes, but actively executes. Intelligent agents will represent users and businesses in searching, negotiating, procuring, settling, and optimizing. In such an economic system, a digital asset with a fixed supply, global portability, deep liquidity, and continuously improving institutional infrastructure will see its value continuously increase. Every new participant strengthens the network; every new wallet, institution, treasury, payment integration, custody platform, and settlement layer makes Bitcoin more useful to the next user. If AI agents become the primary initiators of future transactions, Bitcoin's network effect may become one of its most powerful long-term advantages. The credit aspect adds another layer of support to this logic. As artificial intelligence accelerates its disruption of the software industry, its impact will spread from public software service company valuations to private equity valuations, private credit ledgers, software-secured loans, and the broader financial environment. Investors intuitively understand this: when confidence in code-driven growth assets wanes, funds shift to scarce assets. Market trends have already confirmed this. The risks posed by AI disruption are driving investors to energy, metals, semiconductors, infrastructure, and increasingly, Bitcoin. There is only one growth asset globally that can exist both in the digital world and benefit from the transformation of the code economy by artificial intelligence—that is Bitcoin. Furthermore, there are global implications. The conflict in Iran has increased the probability of rising global food and energy prices, especially in emerging markets that rely on stable production costs. Developed markets can absorb some of the pressure through policy flexibility, reserve currency status, and deeper capital markets, while weaker emerging markets tend to be pressured more quickly. When the costs of food, diesel, fertilizer, and imported energy rise, local currencies will come under pressure, and purchasing power will depreciate rapidly. In this environment, Bitcoin will play a completely new role: it will no longer be just a speculative asset or portfolio diversification tool, but a safe-haven exit for currencies. When local currencies depreciate rapidly, and when households or investors want an asset that won't be diluted by domestic policies, Bitcoin becomes a safe haven for funds. If a new wave of inflation sweeps the globe, Bitcoin's importance will also increase accordingly. Technical analysis is now also beginning to resonate with macroeconomic logic. The weekly MACD indicator for Bitcoin has just formed a golden cross. The significance of such a technical signal is most profound when it aligns with a major underlying cyclical turning point. This is precisely the key moment: a continuously improving technical picture, real interest rates about to turn negative, Bitcoin's performance decoupling from the software sector, artificial intelligence exposing the fragility of fiat currency linkage systems, and the real demand from the new economy pushing up inflationary pressures—this is an extremely rare convergence. Moreover, even with these multiple positive factors, market sentiment in the crypto market and for Bitcoin remains extremely low, meaning that Bitcoin may not just be experiencing a rebound, but rather officially entering its own independent market cycle. This is precisely the situation that investors have been overlooking. They have always expected Bitcoin to follow the trend of traditional risk assets, but its next round of growth stems precisely from a complete shift in pricing logic. It is becoming the only code-based growth asset that benefits from artificial intelligence rather than being disrupted by it; it is becoming a core asset suited to a world of high inflation, weak employment, heightened scarcity, increased hacking risks, negative real interest rates, and fragile trust in the traditional financial system. The core logic lies here: Bitcoin doesn't need new stories. What it needs is for the world to enter the environment it was created to fit into. And all of this may already be happening.