Scott Wolfe

🟧 Coordinator @FBCEglobal
🟦 Board Member @TPB_Inc
🟥 Collaborator @BTCToronto_
🟪 Nostr: npub15m9yc697s82zzy652py0uddmpp5e9xl0920vg6lau9n39fnnzsys6mq643

[Scott Wolfe @ScottAWolfe]

Could financial engineering of the AI boom become the next major financial crisis?

Most people think the #AI story is simple: technology companies are buying massive amounts of chips and data center infrastructure to power the future.

But what if the bigger story isn’t AI itself?

What if the bigger story is how AI infrastructure is being financed?

Michael Burry @michaeljburry, famous for identifying risks in the U.S. housing market before the 2008 financial crisis, has been raising concerns about the growing financialization of AI infrastructure and the possibility that risk is being quietly transferred throughout the financial system.

The issue is not whether AI is valuable. It clearly is.

The issue is whether Wall Street is creating increasingly complex financing structures around AI chips, data centers, and computing infrastructure that obscure where the underlying risk ultimately resides.

In a traditional transaction, a company buys equipment and bears the associated risk.

In today’s market, the process can involve special-purpose entities, private credit funds, securitized debt structures, insurance companies, and annuity providers. By the time the chain is complete, the ultimate source of capital may be ordinary savers and retirees who have no idea their retirement assets are helping finance speculative AI infrastructure expansion.

This should sound familiar.

In the years leading up to 2008, mortgages were transformed into layers of securities that dispersed risk so widely that few participants fully understood their exposure. The result was a system that appeared stable until it suddenly wasn’t.

To be clear, this is not an argument that AI is a bubble or that AI has no future. The technology is real. The demand is real. The innovation is real.

But history teaches us that transformative technologies and financial bubbles often coexist.

Railroads. Telecom. The internet.

The technology can change the world while investors simultaneously overbuild capacity, overextend leverage, and underestimate risk.

The questions regulators, investors, pension funds, insurance companies, and annuity holders should be asking are straightforward:

• How much leverage is supporting AI infrastructure expansion?
• Who ultimately bears the risk if AI spending slows?
• How much exposure do retirement and insurance portfolios have to these structures?
• Are investors receiving sufficient transparency regarding the underlying assets and financing arrangements?

Financial crises rarely emerge from the technology itself.

They emerge when leverage, complexity, and opacity become embedded in the financial system.

The AI buildout may ultimately create extraordinary value for society.

But if the risks are being packaged, securitized, and distributed in ways that few people fully understand, regulators and investors should be paying close attention now—not after the consequences become visible.

The lesson from every major financial crisis is the same:

Pay attention to where the risk ends up, not just where the excitement begins.

The question Burry is effectively asking regulators and investors is:

If AI infrastructure turns out to be overbuilt, who ultimately absorbs the losses?

Many people assume the answer is Nvidia shareholders, venture capitalists, or AI companies.

Burry’s concern is that the answer may increasingly be: insurance companies, annuity portfolios, pension-like retirement products, and ultimately ordinary savers.

———-

Further reading here: https://t.co/2Iv0m9UXeg

[Scott Wolfe @ScottAWolfe]

@GaryCardone I’m seeing lots of puking, capitulation, and “it’s all over” on my timeline to be honest. Lots of tourists have taken their departure flight.

[Scott Wolfe @ScottAWolfe]

@scottmelker If Bitcoin goes to $20,000 I will personally travel to give him his flowers at the retirement home.

[Scott Wolfe @ScottAWolfe]

@JoelHodlman 🙏👊

[Scott Wolfe @ScottAWolfe]

Bitcoin is the world’s largest open-source computing network and it is a fixed-supply, decentralized, global, borderless and permissionless money $BTC.

The fact that it is used simultaneously as a speculative asset by Wall Street billionaires, as a day-to-day money by unbanked kids in South African townships, as censorship-resistant savings by women in Afghanistan, and as a tool to battle climate challenges and residential/commercial heating needs is ALL part of Bitcoin’s resiliency profile and and its emerging omnipresence.

Bitcoin is not going anywhere. The difference between the scale of its use today vs next year vs 10 years from now is simply a function of education. Those who don’t yet hold and use Bitcoin simply don’t understand it yet…like those who chose to using kerosene lamps instead of adopting electricity.

Try putting a long term price on Bitcoin $BTC. All I know is that is that it will be much, much, much, much, much higher than USD $66,000.

[Scott Wolfe @ScottAWolfe]

@criptobastardo Pork bellies?

[Scott Wolfe @ScottAWolfe]

@kaylaparrilla Well, we’re extra incentivized to get this back into pump territory then!

[Daniel Batten @DSBatten]

Just in: Agribusiness giant Adecoagro set to launch 10 MW Bitcoin mining operation in Brazil powered by renewable energy generated from sugarcane processing

The convergence of Bitcoin mining and the energy sector continues

https://t.co/rbPNlPIsav

[Scott Wolfe @ScottAWolfe]

If your time horizon is 30 years then this is among the safest and smartest decisions you could make. Yes, lots of AI plays in the market will have major upside…but for how many years? BTC is fixed-supply sound money operating on the world’s largest open-source computing network.

[Scott Wolfe @ScottAWolfe]

Either you don’t do any research or this is just engagement farming. He explicitly said, weeks ago during their Q1 earnings call, that they would be selling some Bitcoin soon (oh and they only sold 32 BTC, 0.0038% of their total) to accomplish a few specific things:

1. Show credit rating agencies and SP500 that they are willing to sell as needed

2. Tax loss harvest (sell high cost BTC and rebuy at lower cost)

3. Change the narrative from “never sell BTC” to “always be a net buyer of BTC”

@Strategy has enough cash on hand now for more than 6 months of dividend payments, they have just killed $1.5 billion of debt, and they have strengthened $MSTR $STRC $STRD $STRF $STRK for purchase by large institutional investors. All of that will net them the ability to buy more $BTC in future.

Positioning all of the above as an alarm, as forced selling, or anything else of that nature is not only wrong, it’s just dumb.

[Gridless @GridlessCompute]

Some of the people building meaningful bitcoin apps, services, and research in Africa.

@waithiraah of @tando_me
@obi of @fedibtc
@AnaiseKanimba of @AfriBitInst
@ihate1999 of @btrustteam

[Scott Wolfe @ScottAWolfe]

Great segment @hurleyburt @SimplyBitcoin and thank you for the shout out / reference to my “theatre of the heated rivalry” thread below.

Fam, check out the important SB segment at: https://t.co/UoolXC5lEb. Don’t fall for the psyop. Get your $BTC and hold it in self-custody.

[Scott Wolfe @ScottAWolfe]

🚨The crypto vs banks “rivalry” is way too contrived. This is orchestrated theatre. It is fake competition, the stuff of willing partners in an evolving oligopoly. Banking and crypto are merging. The real rivalry is with YOU, with freedom, and truly “decentralized finance”. 🧵…

[Scott Wolfe @ScottAWolfe]

@Leishman @River Most likely BECAUSE of the price dip! 😊

[Scott Wolfe @ScottAWolfe]

@JumpOutGirls Love it! Generational knowledge…and one day generational wealth.

[Scott Wolfe @ScottAWolfe]

@chooserich They say to hurry back, bus is leaving.

[Bitcoin Ekasi @BitcoinEkasi]

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[Scott Wolfe @ScottAWolfe]

@GrantCardone Bitcoin is an open-source, global computing network and decentralized, global, digital money. Bitcoiners are located in every nook of the planet and are as diverse as humans are diverse.

[Scott Wolfe @ScottAWolfe]

@scottmelker “I sit alone in my four-cornered room staring at candles”…bad.

[Ethel Phiri @EthelCPhiri]

We can’t talk about #Bitcoin adoption without talking about the role of circular economies. In Zambia 🇿🇲, @BitZed_ makes it easy to buy & spend Bitcoin.
real use, real community, real freedom.Congrats to me 🥳 just bought some Bitcoin through Bitzed!
#Bitcoin #CircularEconomy #Zambia

[Scott Wolfe @ScottAWolfe]

Come on my guy, do some research. Listen to their last earnings call, look at the mountain that ratings agencies and SP500 have given them to climb (Basel regs too). The reason for this tiny 32 BTC sale was announced well in advance and is it clear as day for anyone who spends 15 minutes researching.