Key Takeaways
- Defiance Capital CEO Arthur Cheong predicts the recent U.S. tech stock selloff will act as a crypto tailwind.
- Cheong expects exiting tech liquidity to pivot to crypto as crypto-native investors return to familiar assets.
- Bitmex co-founder Arthur Hayes echoed this, claiming state AI bailouts will inject more liquidity into crypto.
Defiance Capital CEO Is Still Bullish on Crypto Despite Binance’s Hack
While the cryptocurrency industry is still trying to find its footing in the aftermath of the hack on Binance, the largest security incident in the digital assets’ history, analysts are bullish on the market direction.
Arthur Cheong, CEO and CIO of Defiance Capital, an Asia-focused investment firm dedicated to digital assets, has a positive projection for the crypto market as an unexpected element propping up crypto market surges.
“Despite the Binance hack, I expect the recent US tech/AI equities underperformance to be a strong tailwind for crypto performance over the next 6 months,” Cheong stated on social media.
As Cheong noted, tech and AI markets suffered a harsh selloff on Friday, as the Nasdaq 100 fell 3.4% during the afternoon, with companies like Intel dropping over 29% during the session. The pullback drove the Nasdaq into correction territory, meaning the index dropped by more than 10% from its last historic high.
Cheong believes that if the AI bubble bursts, some of this liquidity will exit the tech ecosystem and will land on crypto again, as investors familiar with the digital assets market recoil and bet on the sector to reach higher relevance in the future.
“Many crypto-natives that off-ramped previously will on-ramp again to reallocate money into the asset class that we are much more familiar with instead of being exit liquidity for all these erratic fast money in tradfi world,” he concluded.
Cheong is not the only one who believes an eventual decline in the U.S. tech/AI sector might precede an exodus of liquidity toward digital assets. Arthur Hayes, co-founder of the now-defunct Bitmex exchange and CIO of Malestrom, an investment fund focused on crypto opportunities, believes that AI companies will become too big to fail, with the U.S. government stepping in to save the sector in the only way it knows: printing trillions out of nowhere.
“The point is they’re going to keep printing money instead of letting the chips fall where they may,” said Hayes in an interview with Bitcoin News at the sidelines of the 2026 Korea Blockchain Week.
The thesis is that this will drive additional liquidity toward crypto markets, which will absorb the excess liquidity from this play.
