Tether’s Paolo Ardoino warns that an AI bubble could hit Bitcoin in 2026, but says deeper crashes are unlikely as institutional demand and RWA tokenization increase.
Summary
- Paolo Ardoino says a bursting AI bubble in US stocks is the biggest risk for Bitcoin in 2026, due to its continued correlation with capital markets.
- He does not expect new declines of 80%, citing the growing interests of pension funds, governments and long-term investors reshaping Bitcoin’s supply.
- Ardoino supports tokenization of real assets, criticizes Europe’s MiCA regime and warns that crypto treasury firms need to build real operational businesses.
Tether CEO Paolo Ardoino said a potential bubble surrounding artificial intelligence could impact Bitcoin markets by 2026, while expressing confidence in the cryptocurrency’s longer-term prospects.
Bitcoin and Tether?
On Thursday, Ardoino spoke on the Bitcoin Capital podcast, co-hosted by Bitfinex Securities and Blockstream, and said Bitcoin remains more closely tied to traditional capital markets than many investors expect. That connection could make the assets vulnerable if U.S. stock volatility, especially around AI investments, increases, the executive said.
“That’s the so-called AI bubble,” Ardoino said, referring to what he characterized as aggressive spending by AI companies. He cited massive investments in data centers, power generation and graphics processing units as signs that capital is being deployed at a pace that may not be sustainable.
Ardoino suggested that if sentiment around artificial intelligence changes sharply, the resulting turbulence in US stock markets could weigh on Bitcoin prices. Although Bitcoin is often marketed as an uncorrelated asset, it still trades in line with broader risk appetite during periods of stress, he said.
In a scenario where enthusiasm for AI wanes by 2026, Bitcoin would likely experience secondary effects from stock market volatility, Ardoino said. However, the executive said he does not expect Bitcoin to repeat the dramatic collapses of previous cycles.
“So I imagine that sharp corrections of 80%, as we saw in 2022 or early 2018, may no longer be the case,” Ardoino said. He attributed this view to growing participation from pension funds, governments and other long-term holders, which he said has changed Bitcoin’s supply dynamics and reduced the likelihood of a panic-induced sell-off.
In addition to Bitcoin, Ardoino expressed confidence in the future of real-world asset tokenization. Tokenized securities and commodities are positioned to become an important part of the next phase of the crypto industry, especially as traditional financial institutions explore blockchain-based issuance and settlement, he said.
The executive warned against excessive institutional dominance within Bitcoin itself. “Bitcoin is for Bitcoin, right?” Ardoino said, adding that he would not want the assets to be overwhelmingly controlled by institutions.
Ardoino provided a critical assessment of Europe’s role in the cryptocurrency sector, arguing that the region is lagging behind other markets due to restrictive regulations and a lack of innovation.
“I’m very bearish on Europe,” said Ardoino, who criticized European policymakers for trying to regulate technologies they don’t yet fully understand. He specifically pointed to the European Union’s Markets in Crypto-Assets Regulation (MiCA), which has intensified the debate over centralized supervision and compliance requirements.
Tether has refused to align its flagship stablecoin with MiCA, a position that has led to several European crypto asset service providers delisting the token. Ardoino called this an example of how regulations could drive innovation out of the region.
The executive also expressed reservations about the growing number of crypto-focused treasury companies whose primary strategy is to hold digital assets. Such companies risk missing out on long-term value if they don’t build meaningful business operations alongside their government bonds, he said.
“I think you want a treasury company to have a great operations business,” Ardoino said. He pointed to Tether-backed Bitcoin company Twenty One as an example of a more balanced approach, describing the goal as becoming a full-fledged Bitcoin services company while maintaining a large Bitcoin treasury, rather than relying solely on asset accumulation.
