Tether CEO Paolo Ardoino has flagged an AI-driven market bubble as Bitcoin’s largest single risk for 2026, tying the concern to rising correlations between BTC and high-growth technology equities. He is effectively warning that an equity-led AI correction could transmit into crypto markets if liquidity tightens and risk assets de-risk in parallel.
Why an AI equity correction could spill into Bitcoin
The risk channel is framed around a reported 2.77 beta linking Bitcoin to AI-stock moves. Beta measures an asset’s sensitivity to movements in another market, and a 2.77 beta implies outsized responsiveness of BTC to swings in AI equities. In practical terms, the argument is that stronger capital-flow overlap and shared funding conditions can pull Bitcoin into the same drawdown cycle as high-growth tech.
Rising interest rates and reduced cheap capital are positioned as potential catalysts for this contagion path. If borrowing costs climb, leveraged positions in AI equities and adjacent credit structures may unwind, and the resulting deleveraging can spill into crypto through institutional exits and broader risk reduction. The comparison to historical tightening-driven collapses is used to illustrate how funding conditions can compress risk appetite across equities and crypto at the same time.
🦔I think the AI bubble is going to pop, and when it does, it's going to be uglier than people expect. Forrester predicts a market correction in 2026, and honestly, I think they're being optimistic. The sector is spending $400 billion while only bringing in $60 billion in…
— Hedgie (@HedgieMarkets) December 15, 2025
Market expectations for 2026 are described as highly dispersed, reflecting uncertainty on both timing and magnitude. Forecast ranges cited in the debate span from bearish correction scenarios to higher-end bullish targets, underscoring the lack of consensus on where BTC could land in 2026. Downside ranges of $60,000–$75,000 are linked to warnings of 50–65% crashes from peaks and technical signals such as the 50-week EMA. Moderate bullish ranges of $100,000–$160,000 are attributed to commentary and forecasts referenced by outlets including Nasdaq. Higher-end targets of $150,000–$200,000 are associated with Standard Chartered and Bernstein for 2026–2027.
The narrative includes sharp disagreement among market voices. Prominent skeptics emphasize downside risk, including one investor calling Bitcoin “worthless” and likening it to a tulip-bulb episode, while others cite four-year cycle dynamics that historically align with 2026 weakness. On the other side, advocates point to ongoing institutional adoption and regulated investment vehicles as demand anchors that could keep market structure more resilient.
Several countervailing forces are presented as potential buffers against a pure equity-to-crypto spillover. Greater institutionalisation, including larger asset-manager participation and wider availability of regulated products, is described as a liquidity backstop that may reduce the likelihood of extreme, retail-style drawdowns. In parallel, tokenization of real-world assets and crypto-native AI innovations are cited as internal demand drivers that could partially offset an external shock.
These offsets are not positioned as a full hedge against correlation risk. The core takeaway is that a 2026 AI bubble burst is presented as a credible contagion risk to Bitcoin via correlation and macro-liquidity channels, even if institutional depth may dampen peak-to-trough severity and shorten the duration of a correction.