Bitcoin’s next major rally may not start within crypto itself — it could begin in the artificial intelligence stock sector.
Macroeconomist Lyn Alden believes Bitcoin could benefit if AI stocks become excessively overvalued and investors begin rotating capital elsewhere. Speaking with Natalie Brunell on the Coin Stories podcast, Alden explained that Bitcoin only needs a small wave of fresh demand to move significantly higher.
Currently trading around $67,800, Bitcoin has dropped sharply from its October all-time high of $126,100. However, Alden suggests that capital flowing out of inflated AI equities could become a powerful catalyst for the next Bitcoin bull run.
AI Stocks May Be Nearing a Valuation Peak
Artificial intelligence stocks have dominated market attention over the past year. Companies leading the AI buildout have seen enormous gains, drawing substantial institutional and retail investment.
For example, chipmaking giant Nvidia (NVDA) has surged more than 35% over the past 12 months. As one of the largest companies on the Nasdaq by market capitalization, Nvidia is widely viewed as a primary beneficiary of the AI boom.
However, some analysts are questioning whether that growth can continue at the same pace. Albion Financial Group’s CIO has suggested that while Nvidia may continue delivering strong earnings, the real question is whether performance will be “good enough” to justify even higher valuations.
When stocks reach extreme valuations, further upside becomes harder to sustain. Historically, this often triggers a capital rotation — where investors move funds from overextended assets into sectors offering greater growth potential. Alden believes Bitcoin could be one of those beneficiaries.
Why Bitcoin Only Needs “Marginal Demand” to Rally
Unlike traditional equities, Bitcoin does not require massive capital inflows to make large price moves. According to Alden, even a modest increase in demand can push prices significantly higher.
She explained that long-term Bitcoin holders effectively create a price floor. Over time, coins tend to move from short-term traders into the hands of strong, conviction-driven investors. These holders are typically unwilling to sell unless prices rise dramatically — sometimes five times higher or more.
This tightening supply dynamic means that when new buyers step in, the impact on price can be amplified.
Still, Alden does not expect an immediate sharp rebound. She noted that Bitcoin rarely forms quick V-shaped recoveries outside of extraordinary macro events, such as stimulus-driven surges. Instead, Bitcoin often bottoms out and trades sideways for an extended period before beginning its next sustained climb.
At the moment, she describes the market as being in a “grinding” phase. Bitcoin could potentially fall another $10,000 to $20,000 before establishing a clearer bottom.
