Crypto entrepreneur Balaji Srinivasan discussed on May 2 the ongoing banking crisis and announced that he had committed funds to his $1 million Bitcoin bet.
Balaji says US government is printing trillions
In a video posted to Twitter, Srinivasan said:
“I just burned a million to tell you they’re printing trillions … I wanted to tell you in a provable way that … there’s something wrong in the economy and the state isn’t telling you about it. And things could unwind very fast.”
Srinivasan drew attention to various ongoing financial crises, including the government debt ceiling, recent bank failures, the real estate crisis, and the bond crisis.
Specifically, he noted the U.S. government printed $300 billion just days after the collapse of Silicon Valley Bank in order to bail out the company and rescue other banks. He also suggested that the banking system has seen $2.2 trillion in unrealized loss over the past year, based on recent data from Stanford University.
Srinivasan also highlighted trillions in pensions, auto loans, student loans, and credit card debt. Furthermore, he drew attention to international affairs by commenting on $75 billion of Ukraine aid sent by the U.S. and $700 billion of energy subsidies in Europe.
He also warned that a fiat crisis could occur suddenly. Srinivasan argued that Federal Reserve policies could result in a “crash landing” — contrary to Federal Reserve Chairman Jerome Powell‘s promise of a “soft landing” and gradually reduced inflation.
He also reiterated his earlier claim that there is a 10% chance that a fiat crisis will occur in the coming months and a 70% chance that a crisis will occur in the coming years.
Srinivasan bet $1.5 million on chain
Srinivasan said that these concerns justified his earlier bet. In late March, Srinivasan said that he would bet $1 million that the price of Bitcoin would reach $1 million within 90 days.
On May 2, he said that he had committed to that bet with three on-chain Bitcoin transactions. He committed $1.5 million of Bitcoin in total, donating $500,000 to Bitcoin Core development via Chaincode and $500,000 to Give Directly. He also sent $500,000 to pseudonymous Twitter user James Medlock, with whom he originally arranged the bet.
Srinivasan apparently did not use escrow, as he said that he had “settled the bet ahead of time and donated even more than [he] had committed.”
Bitcoin is currently priced at $28,700, and a $1 million price tag would represent a 35-fold price increase. Some have called such rapid gains unlikely and suggested that Balaji arranged the bet to market Bitcoin without expecting to win.
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