Bitcoin’s next big rally could depend on whether artificial intelligence stocks become too overvalued in the eyes of investors, according to macroeconomist Lynn Alden.
“AI stocks may just end up peaking, getting so ridiculously large that they can’t realistically go any higher,” Alden told Natalie Brunel on the “Coin Stories” podcast published on YouTube on Thursday.
When asset prices rise to a level where further gains are difficult to justify, capital is often moved to other opportunities with more upside potential.
Bitcoin (BTC) is down about 46% from its all-time high of $126,100 in October, and Alden suggests Bitcoin could benefit from that rotation.
Nvidia could become the ‘most important stock’ in the US, says executive
Some financial analysts are questioning whether the biggest AI stocks can maintain their momentum into 2026. Jason Ware, chief investment officer at Albion Financial Group, recently told Fox Business that he expects Nvidia (NVDA), the largest GPU chip maker on the Nasdaq Stock Exchange by market capitalization, to have “another great quarter,” but questioned whether it would be “a good enough quarter.”
“We all know they are the most concentrated and clear winner in building AI. Can that growth continue in a way that supports stock price growth?”
Nvidia (NVDA) stock is up 35.48% in the past 12 months, according to Google Finance, and Weir said the company is “probably the most important company in the U.S. and the most important stock on the market.”
Rising investor interest in AI means Bitcoin is “competing for capital” like never before, Bitcoin developer Mark Carraro said on Thursday.
Bitcoin only requires a “marginal amount” of new demand
But Alden said Bitcoin doesn’t need a big wave of money to rise. “There’s just a small amount of new demand coming in,” Alden said, adding that long-term holders are essentially “securing the floor” as short-term traders come and go.
“The coin rotates from fast-funding hands to strongly held hands. They really don’t want to let go unless it goes up 5x or more. Those are the types of buyers,” she said.
According to CoinMarketCap, Bitcoin was trading at $67,849 at the time of publication, down 24.49% over the past 30 days.
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Alden said he does not expect Bitcoin prices to skyrocket in the short term.
“Bitcoin rarely forms a V-shaped bottom outside of the coronavirus stimulus event,” he said, adding, “It usually hits a low level and then levels off for quite a while.”
“I think we’re in a much tougher spot,” Alden said, adding that the stock could be down $10,000 or $20,000, but it’s still in that “tough stage.”
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