Why This Bitcoin Dip Is Actually Bullish | Mike Alfred

Alfred links Bitcoin mining to the early development of U.S. computing-power infrastructure, which is now being redirected toward AI. He argues that computing capacity could become a proxy for military strength as AI supports drone swarms, targeted missiles, and missile defense, while demand for AI data centers already exceeds supply.

Alfred describes the AI infrastructure buildout as a market-driven, 20- to 30-year capital-allocation theme spanning data centers, self-driving cars, robots, and drones, even if political friction causes interruptions. He also says market performance has so far been concentrated in AI-linked parts of the S&P 500, while much of crypto and non-AI assets have stagnated or declined.

Alfred says roughly $2 trillion U.S. deficits will require continued debt issuance, refinancing, and monetization, although he views the timing of the next bull market as uncertain. Against that backdrop, he sees residential real estate as a potential five- to 10-year opportunity once high rates and prices become less restrictive and the asset class remains out of favor.

Alfred characterizes Bitcoin's decline from roughly $60,000 to $57,000-$58,000 and rebound toward $76,000 as a midcycle correction rather than a four-year-cycle bear market, comparing it with the 2020 drawdown and subsequent rise into the $60,000s. He says the 10-year Treasury yield, which reached its highest level since November 2023, has acted as a catalyst for both Bitcoin's earlier rise and its current dip.

Alfred says crypto's post-December 2022 recovery has not produced the broad rally seen in earlier cycles, with some participants moving into AI or leaving crypto because opportunities were limited. He believes the October 10 Binance disruption, including liquidated market makers and a stablecoin depeg, may have reinforced a self-fulfilling belief that Bitcoin had topped in a relatively small and brittle market.