Bitcoin’s quiet rally has captured the attention of Wall Street and beyond, but some voices from OG Bitcoiners like American HODL are predicting that what we’ve witnessed so far is just the calm before an explosive storm.

The Bitcoin treasury bubble thesis

The Bitcoin treasury bubble thesis is that, within just a few years, a tidal wave of corporate, institutional, and possibly sovereign capital totaling as much as $11 trillion could flood into Bitcoin. Some projections suggest that true mania may not hit until 2026 or beyond, potentially sending the price as high as $1 million per coin.

Swan Bitcoin exchange unpacked this thesis, examining the signals, mechanics, and real-world examples supporting the case for a Bitcoin treasury bubble that could rival the wildest days of the dot-com boom. Let’s check it out.

A historic build-up: From $2.4T asset to corporate standard

This month, Bitcoin marked a new all-time high above $120,000, pushing its market cap to $2.4 trillion, trailing only behind Amazon, Apple, Microsoft, Nvidia, and gold.

Yet, this move has come with little public awareness or euphoria. The price has stair-stepped higher in a quiet fashion, led not by retail speculation but by deliberate, low-profile corporate and institutional buying. As Swan pointed out:

“This is the least euphoric bull market we’ve ever seen… and that’s bullish.”

Public companies ranging from Strategy to Metaplanet, GameStop to Trump Media are accumulating Bitcoin on their balance sheets, and more novel models, such as those pioneered by Strive Asset Management, see companies converting cash reserves to Bitcoin, not for speculation but as an inflation hedge and long-term holding.

Weakening dollar, diminished safe havens

JPMorgan CEO Jamie Dimon recently warned that if the U.S. can’t rein in ballooning debt, America might lose its stance as the world’s reserve asset. He said:

“I just don’t know if it’s going to be a crisis in six months or six years, and I’m hoping that we change both the trajectory of the debt and the ability of market makers to make markets. Unfortunately, it may be that we need that to wake us up.”

As of fiscal year 2025, U.S. debt interest payments are projected to reach $952 billion, and as the dollar loses luster, Bitcoin’s narrative as “digital gold” and a reserve asset strengthens.

BlackRock CEO Larry Fink echoed Dimon’s concerns, saying:

“If the U.S. doesn’t get its debt under control, if deficits keep ballooning, America risks losing that position to digital assets like Bitcoin.”

The return of easy money

The bond market is pricing in interest rate cuts, suggesting a potential return to “easy money” conditions as early as 2026. Lower rates mean cheap capital, more risk-on sentiment, and historically, a surge in asset prices, including Bitcoin. As Swan observed:

“Bitcoin ran from $42K → $123K during the tightest monetary policy in modern history.

What happens when liquidity floods back in?”

Remember the lockdown era? When rate cuts during the COVID-19 pandemic spurred rally after rally across crypto markets, culminating in parabolic gains for Bitcoin? With another cycle of rate slashing potentially on the horizon, the setup looks eerily similar.

The Bitcoin treasury bubble mechanics

According to Swan, big buyers are still mostly on the sidelines, finalizing mergers and legal structures. Names like Nakamoto, Twenty One Capital, and Strive Asset Management have yet to fully deploy capital, but are preparing multi-billion-dollar mandates.

As coins are absorbed by corporate treasuries through algorithmic “drip-buying,” available supply dries up without dramatic price spikes.

When enough boardrooms and sovereigns hit “bid” at the same time, price action could turn “reflexive” where buying by one entity triggers more entities to chase Bitcoin, echoing the late-’90s scramble for “internet stories.”

Just like every dot-com needed an “internet story” to survive in 1999, every major firm may soon feel pressure to have a “Bitcoin strategy.” This “narrative contagion” can push prices to unimaginable heights (well beyond what fundamentals alone would suggest).

Where could this lead? $1M Bitcoin and beyond

American HODL, among others, sees a realistic path:

“I think the treasury company bubble can get dot-com level large. We could see a 3–4 year run that takes Bitcoin well beyond a million dollars.”

This isn’t isolated. BitMEX’s Arthur Hayes and long-term Bitcoin advocate Mark Moss also projected a $1,000,000 BTC by 2030.

So is it plausible that we’re seeing the opening moves of a bubble that could rival the dot-com era? The pieces are falling into place. Mania may yet be a year or two away, but if history rhymes, the blow-off top could take Bitcoin to levels few believed possible just a few years ago.

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Chicago media ran stories today about a police officer there who was shot and killed while pursuing a fleeing suspect. They name the 36-year-old officer, a woman with a young daughter, who chased the suspect on foot. They quote a senior officer saying she was protecting lives and lost her own as a hero who wanted to make Chicago safer.

She was a four-year department veteran on duty with a 6th District tactical team, they report, stopping a man they understood to be armed. They relate the suspect’s flight into a nearby apartment, and an armed confrontation commencing with those within. One pointed a rifle at them and officer Krystal Rivera was shot: “Shots fired at police,” one officer “screamed.” Rivera was rushed to local hospital, but died.

“This is the risk our officers take every single day,” Police Superintendent Larry Snelling is quoted saying. Two suspects were arrested. Three firearms were recovered at the scene. One story closes on a poignant quote from Mayor Brandon Johnson: “Her young, energetic and bold approach toward keeping us safe is the memory we will honor.”

Hundreds of words. Dozens of paragraphs. But nowhere do any of these reporters state who is thought to have shot and killed Krystal Rivera. Police are usually enthusiastic about naming them, especially when they are in custody.

The story is an unusually extreme example of what some call “the exonerative tense” in reportage about bad things that happen in the presence of police. When it comes to the moment where the key act would be described, such stories retreat into the passive voice, law enforcement jargon and peculiar omission: guns are discharged, individuals are impacted, subjects become unresponsive. It reflects the language of police reports and press releases, adopted verbatim by newswriters and editors eager to please departments that are often their key sources.

A clue is offered in the PBS story: “The Civilian Office of Police Accountability is also investigating the incident.” I’m sure they are.

Note how my post never states that Rivera was shot and killed by another cop? You likely think it does. It’s an intentional technique and it works. But I don’t know if that’s really what happened. We can only hope the police soon have local media post what did.

Bottom line: More than four years after Mark Zuckerberg rebranded Facebook as Meta to chase his metaverse vision, the company has poured tens of billions into the effort – with little to show for it. The ongoing losses have raised serious doubts about the strategy and its long-term viability.

Insiders say the metaverse project has become a financial sinkhole, consuming $45 billion by early 2025. That’s nearly equal to the combined market caps of social media rivals Snap and Pinterest – or the amount Elon Musk paid to acquire Twitter. Worse, Zuckerberg warned in last year’s earnings report that losses would continue to “increase meaningfully,” whatever that means.

Yahoo Finance spoke to over a dozen former high-level Reality Labs employees, who described the wing as dysfunctional and disorganized. Frequent leadership changes and constant reshuffling reportedly sowed chaos, with many managers brought in from other Meta divisions despite lacking AR and VR expertise.

One former research employee described the work environment as “chaotic,” with “local heroes” from divisions like Instagram promoted to lead virtual reality teams despite lacking relevant experience. Another ex-staffer said Meta recklessly “plays employee bingo,” assigning AR and VR roles to people who “don’t really understand it.” This combination of unqualified leadership and an unclear product strategy has significantly contributed to the division’s staggering losses.

Financial disclosures show the branch’s losses have surged over the last several years – more than $6 billion in 2020, $10 billion in 2021, $13 billion in 2022, and $16 billion in 2023. The division lost another $3.8 billion in just the first quarter of 2024, wiping out its total revenue from 2022 and 2023 combined.

Despite rising expenditures, the division’s annual revenue has declined steadily since 2021 due to weak sales and continued failure to gain mainstream traction. Wall Street analyst Gene Munster of Deepwater Asset Management told Yahoo Finance that the division is a “financial disaster” dragging down Meta’s stock.

While some investors have remained patient, betting on the long-term promise of AR and VR, that optimism is starting to fade. Barring rapid mainstream adoption, losing $10-15 billion annually on Zucckerberg’s metaverse pipe dream is unsustainable.

Why it matters: Major tech players have spent the last few years betting that simply throwing more computing power at AI will lead to artificial general intelligence (AGI) – systems that match or surpass human cognition. But a recent survey of AI researchers suggests growing skepticism that endlessly scaling up current approaches is the right path forward.

A recent survey of 475 AI researchers reveals that 76% believe adding more computing power and data to current AI models is “unlikely” or “very unlikely” to lead to AGI.

The survey, conducted by the Association for the Advancement of Artificial Intelligence (AAAI), reveals a growing skepticism. Despite billions poured into building massive data centers and training ever-larger generative models, researchers argue that the returns on these investments are diminishing.

Stuart Russell, a computer scientist at UC Berkeley and a contributor to the report, told New Scientist: “The vast investments in scaling, unaccompanied by any comparable efforts to understand what was going on, always seemed to me to be misplaced.”

The numbers tell the story. Last year alone, venture capital funding for generative AI reportedly topped $56 billion, according to a TechCrunch report. The push has also led to massive demand for AI accelerators, with a February report stating that the semiconductor industry reached a whopping $626 billion in 2024.

Running these models has always required massive amounts of energy, and as they’re scaled up, the demands have only risen. Companies like Microsoft, Google, and Amazon are therefore securing nuclear power deals to fuel their data centers.

Yet, despite these colossal investments, the performance of cutting-edge AI models has plateaued. For instance, many experts have suggested that OpenAI’s latest models have shown only marginal improvements over their predecessor.

Beyond the skepticism, the survey also highlights a shift in priorities among AI researchers. While 77% prioritize designing AI systems with an acceptable risk-benefit profile, only 23% are focused on directly pursuing AGI. Additionally, 82% of respondents believe that if AGI is developed by private entities, it should be publicly owned to mitigate global risks and ethical concerns. However, 70% oppose halting AGI research until full safety mechanisms are in place, suggesting a cautious but forward-moving approach.

Cheaper, more efficient alternatives to scaling are being explored. OpenAI has experimented with “test-time compute,” where AI models spend more time “thinking” before generating responses. This method has yielded performance boosts without the need for massive scaling. Unfortunately, Arvind Narayanan, a computer scientist at Princeton University, told New Scientist that this approach is “unlikely to be a silver bullet.”

On the flip side, tech leaders like Google CEO Sundar Pichai remain optimistic, asserting that the industry can “just keep scaling up” – even as he hinted that the era of low-hanging fruit with AI gains was over.