20VC partner P_Bonnet published an article comparing the history of the aluminum industry to AI, discussing a scenario of “if everything goes well.” Most supply shortages will turn into surpluses and destroy value within 3-5 years, but the aluminum industry has seen a price drop of over 99.9% and a market expansion of over 1000 times over more than a century, as each price reduction unlocks new uses rather than collapsing within the same market.

AI Tokens are moving up the same cost ladder at nearly 10 times the speed, with the key point being that humans are no longer a constraint. Conversational AI is limited by human reading speed and user scale, while reasoning and agents can make consumers no longer human. Agentic AI could completely remove the human ceiling, leaving only the rapidly improving costs and utilities. The aluminum industry also relied on breakthroughs in processes to transform cheap metal into structural materials.

At the infrastructure level, Alcoa monopolized for decades through processes, its own ore, and electricity; Nvidia has accumulated processes like CUDA, with production capacity resembling leasing, and lacks its own electricity, as major clients have directly locked in nuclear power and are developing their own chips. Ultimately, value will gradually shift to those who discover new uses that could not exist at old prices; price collapse, technological effectiveness, and capital migration are not opposing forces but rather the same outcome.