Bitcoin Could Feel AI Bubble Fallout in 2026, Says Tether CEO

Paolo Ardoino, the CEO of Tether, has warned that a potential bubble forming around artificial intelligence could spill over into Bitcoin markets by 2026, even as he remains broadly optimistic about the cryptocurrency’s longer-term outlook.

Speaking on Thursday during the Bitcoin Capital podcast, co-hosted by Bitfinex Securities and Blockstream, Ardoino said BTC remains more closely tied to traditional capital markets than many investors expect. 

That connection, he argued, could leave the asset vulnerable if froth in U.S. equities — particularly around AI — begins to unwind.

“That is the so-called AI bubble,” Ardoino said, referring to what he sees as aggressive and potentially excessive spending by AI companies. He pointed to 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.

AI Bubble Risks Could Spill Into Bitcoin

Ardoino suggested that if sentiment around artificial intelligence shifts sharply, the resulting turbulence in U.S. stock markets could weigh on Bitcoin prices as well. While Bitcoin is often marketed as an uncorrelated asset, he argued that, in practice, it still trades in line with broader risk appetite during periods of stress.

In a scenario where AI enthusiasm cools in 2026, Ardoino said Bitcoin would likely feel secondary effects from equity market volatility. 

That exposure, however, does not translate into an outright bearish outlook on the asset.

Sharp Bitcoin Crashes Seen As Less Likely

Despite flagging macro risks tied to AI, Ardoino said he does not expect Bitcoin to repeat the dramatic collapses of previous cycles. He argued that the structure of the market has changed significantly since 2018 and 2022.

“So I would imagine that sharp corrections of 80%, like we saw in 2022 or early 2018, might not be the case anymore,” Ardoino said. 

According to him, growing participation from pension funds, governments and other long-term holders has altered Bitcoin’s supply dynamics and reduced the likelihood of panic-driven selloffs.

Bitcoin’s evolution into a macro-linked asset, rather than a purely speculative one, could still result in volatility, but Ardoino believes downside moves are likely to be more measured than in the past.

Tokenization Seen As A Major Growth Driver

Beyond BTC, Ardoino expressed strong confidence in the future of real-world asset tokenization. He said tokenized securities and commodities are poised to become a significant part of the crypto industry’s next phase, particularly as traditional financial institutions explore blockchain-based issuance and settlement.

According to Ardoino, the tokenization of real-world assets could unlock new efficiencies and expand access to markets that have historically been limited to institutional participants. At the same time, he cautioned against excessive institutional dominance within Bitcoin itself.

Also read: Crypto Asset Manager CoinShares Sees Bitcoin and Tokenization Reshaping Finance by 2026

“Bitcoin is for Bitcoin, right?” Ardoino said, adding that he would not want to see the asset become overwhelmingly controlled by institutions. 

His remarks reflected an ongoing tension within the industry between preserving Bitcoin’s original ethos and embracing large-scale adoption.

Bearish Outlook On Europe And Regulation

While Ardoino remains optimistic about global crypto adoption, he expressed a notably pessimistic view of Europe’s role in the sector. He argued that the region continues to lag behind other markets due to restrictive regulation and a lack of innovation.

“I’m very bearish on Europe,” Ardoino said, criticizing European policymakers for attempting to regulate technologies they do not yet fully understand. He specifically pointed to the European Union’s Markets in Crypto-Assets Regulation (MiCA), which has intensified debate over centralized oversight and compliance requirements.

Tether has openly declined to align its flagship USDT stablecoin with MiCA, a stance that has led several European crypto asset service providers to delist USDT. Ardoino framed this as a broader example of how regulation could push innovation away from the region rather than foster it.

Skepticism Toward Pure Treasury Companies

Ardoino also shared reservations about the growing number of crypto-focused treasury companies whose primary strategy is simply holding digital assets. He said such firms risk lacking long-term value if they do not build meaningful operating businesses alongside their treasuries.

“I think that you want a treasury company to have an amazing operational business,” Ardoino said. He pointed to the Tether-backed Bitcoin company Twenty One as an example of a more balanced approach.

According to Ardoino, the goal for Twenty One is to become a full-fledged Bitcoin services company while also maintaining a large Bitcoin treasury, rather than relying solely on asset accumulation.