The Former CTO of Coinbase Bets $2 Million That Bitcoin will Hit $1 Million in 90 days

Balaji Srinivasan, a former Coinbase CTO, has bet $2 million that Bitcoin would reach $1 million in 90 days. This wager was in reaction to financial expert James Medlock's $1 million wager that the United States would not incur hyperinflation despite the country's recent bank failures.

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Balaji stated his views and why he was offering the bet in a Twitter discussion on March 17. He says that the present banking scenario is comparable to the 2008 financial catastrophe, except that this time, central bankers, banks, and regulators have misled to all dollar holders and depositors. According to the investor, the financial crisis went beyond fractional reserves since banks did not have enough cash to cover withdrawals on a market-to-market basis.

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Balaji further claims that banks predicted the meltdown but were enabled by authorities to conceal their true insolvency until it became a huge issue. He noted that banks used a similar technique of exploiting consumer money to invest in problematic bonds, citing the travails of former FTX chief executive Sam Bankman-Fried.

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"They all utilized the money to purchase the ultimate shitcoin: long-dated US Treasury bonds. And they were all rekt at the same moment and in the same way because they acquired the same item from the same vendor who depreciated it at the same time: the Fed," Balaji said. But it isn't all. Balaji believes that the present financial crisis will result in "hyperbitcoinization," a phenomenon in which the globe redenominates Bitcoin as digital gold, similar to the paradigm utilized with actual gold before the twentieth century. He also stated that in the next weeks, people, businesses, and major entities such as sovereign governments will acquire Bitcoin to hedge against hyperinflation.

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Balaji paints a bleak picture, believing that hyperinflation would develop quickly if dollar holders understand that the Fed deceived them about the amount of money in banks. Using a chart of USD/BTC long-term depreciation, the expert predicts a substantial decrease in the next weeks.

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Balaji ends by claiming that he will transfer $2 million into USDC for the bet. This will be divided into a $1 million bet with Medlock and a $1 million bet with someone else. "Terms of the bet: ideally, someone can write up a smart contract where Bitcoin is valued >$1M in 90 days, then I win. If it is worth less than $1 million in 90 days, the counterparty receives the $1 million in USD," he stated.

Former BitMex CEO Arthur Hayes feels that Bitcoin might reach $1 million. "Bitcoin Equals $1 million," Hayes tweeted, along with a screenshot of a Bloomberg item on China's move to lower the reserve repo rate (RRR).

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A mix reaction to Crypto Community

Naturally, the crypto community had different feelings about Balaji's wager. While some feel his views are correct, the vast majority agree with him. At the time of writing, the price of Bitcoin is approximately $27,000.

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