Balaji Lost His 1 Million $ Bet On Bitcoin

Remember in March when Balaji Srinivasan Made his $1M Bet?

Back then he predicted that within 90 days Bitcoin would go to $1M. His argument was that US economy would go into hyperinflation (with the dollar essentially losing most of its value) and that Bitcoin would be a "safe haven" for assets. Well... not even 90 days after the bet Balaji has now conceded his bet donating 1.5M worth of crypto to charity and Bitcoin development. Kudos to him for honoring his part of the agreement, but it was probably more of a publicity stunt. He reveals more about his intentions:

Srinivasan went on to say that economic catastrophe was coming and that he made the donations to make the point that “things could unwind very fast. “Many things are breaking at once,” he continued, referring to the U.S. debt ceiling, the banking crisis, bonds losing value, and the Russia-Ukraine war. “I just burned a million to tell you they’re printing trillions.”

So all of this to raise attention to the bad state of the economy and the geopolitical situation in general... I guess this is something only a rich person can do and there is no doubt that he did raise some eye brows.

He definitely has a point: the US in particular is "printing" so much money that the government does not have the intention or the capability to actually pay back all of the debt. With more than 30 trillion (!) it seems impossible. The answer so far has been to simply kick the can down the road (raising the debt ceiling etc.). But surely, this cannot continue for ever?

So essentially he is saying that we will come to a breaking point (he also pointed to the unstable geopolitical situation) in which the economy will crash and we will have to fundamentally reassess the situation as a whole. He believes that crypto will be part of the solution. Personally, I couldn't agree more, but of course it is still entirely unclear what kind of version of crpyto we would be looking at. Surely, CBDCs would be not the answer and somehow I doubt that global economies will just shift to Bitcoin etc.

But perhaps we cannot yet grasp how a new system will ultiamtely look like, so it makes sense to first reason that when the legacy economy crashes (and goes into a depression) that Bitcoin would actually be the first alternative which was designed for exactly this scenario.

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