Compiled by: Felix, PANews
Former Coinbase chief technology officer Balaji Srinivasan bet on Friday that bitcoin prices will benefit from a rapid depreciation of the dollar over the next three months, surging to $1 million by June 17. Balaji wagered two people on the same day, paying out $1 million with financial expert James Medlock and another anonymous individual. If Bitcoin does not rise to $1 million, the two will each receive $1 million worth of USDC.
Balaji believes the global economy is at a critical point of rapid change, which he calls “hyperbitcoinization.” He predicts that the U.S. dollar will enter rapid hyperinflation, and then the global economy will enter an era that will rebrand Bitcoin as "digital gold."
As far as the current market is concerned, according to CoinGecko data, if it rises to 1 million US dollars, the market value of Bitcoin will rise from the current approximately 549 billion US dollars to approximately 19.3 trillion US dollars. By comparison, the U.S. stock market was worth just over $40.5 trillion at the end of last year, according to data released by Siblis Research.
Balaji's forecast comes against a backdrop of a string of bank failures in the United States, injecting fear and uncertainty into financial markets. While Bitcoin’s correlation to stock indexes like the S&P 500 and Nasdaq remains significant, some on Twitter have dubbed it a “bill” given that it recently surged above $28,000 as Wall Street faltered. The great decoupling".
The bold bet sparked a buzz among some crypto KOLs, including bitcoin educator Jimmy Song and venture capitalist Adam Cochran, who gave an in-depth analysis of the reality of the prediction.
Referring to the performance of cryptocurrencies during the 2020 "New Crown" ravages, Cochran said that Bitcoin needs a more extreme catalyst than this to exceed the 547% increase from 2020 to 2022.
Cochran believes that the collapse of the US and European banking systems will eventually obscure the potential value of Bitcoin as an asset, because it is better to use the money to buy food, fuel for life and so on.
"In short, stores of value, or alternative assets, do well when we doubt the profitability of the economic system, rather than the existence of the system, and if the system doesn't exist, we reduce demand and spend money on the necessities of life," he said. , not on valuables".
Cochran said that Balaji's bet came after the crypto market entered a cold winter. The crypto winter came last year. At that time, prices plummeted and many crypto companies went bankrupt. Hoping for things to improve." “It’s disappointing to see the crypto industry being propelled by unrealistic bets in such a dangerous macro environment,” he said.
But other voices, such as Jimmy Song, appear to back Balaji's bet, claiming that bitcoin can play some role in today's crisis in the financial system.
“Bitcoin will play a key role in mitigating some of the catastrophic effects, as a tightly constrained currency, Bitcoin provides a better store of value, dampening the effects of hyperinflation,” he said.
Bloomberg's Matt Levine then asked a straightforward question: If Balaji thinks Bitcoin will hit $1 million in 90 days, why is he using that money to bet instead of buying Bitcoin?
In a subsequent tweet, Matt Levine suggested that, based on the responses he received, Balaji's actions may have been an attempt to "manipulate Bitcoin's price increase." Others said Balaji could have made the bet, but instead used it to gain exposure for himself and Bitcoin.
According to Datawallet, Balaji's net worth is estimated to be around $150 million. He joined Coinbase after it was acquired by a company he co-founded, Earn.com, which rewards users with digital assets for completing small tasks. Balaji worked at Coinbase for about 14 months before leaving in May 2019. Among the accomplishments listed on his LinkedIn profile, he was responsible for organizing the "business and technical aspects" of the USDC Stablecoin launch.
Balaji isn't the only one envisioning a Bitcoin price rise to $1 million. In January last year, Cathie Wood's ARK Invest projected that Bitcoin could exceed $1 million by 2030, saying that the Bitcoin network "is likely to scale as sovereign nations adopt Bitcoin as legal tender."
