Balaji Srinivasan has been all over Bitcoin and finance news for the last two months. The man who bet $1 million that Bitcoin would reach a price point of $1 million within the next 90 days. If you are unaware of Balaji, he was the former CTO of COINBASE and is very prominent as a VC investor.
Just this week Balaji closed his bet early and paid it off fully. With the price of Bitcoin currently sitting at around $29,000; most would assume that his bet was a massive failure and embarrassment for him. But was it actually? What if I told you it was far and away successful for him?
Let’s dig into this deeper.
When looking at this from the outside, most people only focus on one thing; Bitcoin never came close to reaching the $1 million price point. That Balaji closed and paid off the bet early; meaning that he knew it had no chance of becoming a reality.
The truth actually goes much further than this. The reality is that this bet was always only about one thing.
Balaji was trying to warn everyone that extreme monetary printing was coming. That it was time to run for the exits. Get your money out of banks. That incredible pain would soon be coming to all financial sectors, and the only way out to protect yourself is with Bitcoin.
When he first declared that he was making this bet, everyone looked at him like he was crazy, and for the most part, they still do. It isn’t hard to blame him. At the time it seemed like the bet not only came out of nowhere but was such a large amount of money that it didn’t have any chance of happening.
But soon after he made the bet, something strange began to happen. Banks began collapsing left and right. People’s funds were frozen on those services. The US government had to print obscene amounts of money to make the users at those banks whole. The banks were bailed out by the government and weren’t allowed to fail.
While the initial pain of banks going under would have been extreme. In the long run, it is necessary to begin healing the broken system. But instead, the government put a bandaid on a wound that was too severe to heal.
People began waking up to the fact that there was a real problem. They recognized that perhaps Balaji was on to something. All of a sudden he didn’t seem so crazy.
But then came a moment period of peace. After the US government began bailing out banks, they urged that everything was under control. That bank collapse contagion had come to an end. Naturally, people began to quickly forget that anything had happened and went about living their daily lives. Thinking that the worst was behind them.
However, it turned out that we were simply in the eye of the hurricane, and perhaps it was just the beginning. Just this week, the bank collapse contagion continued, and we could be very far from the end.
Even in the beginning days of Balaji’s bet, he hinted that he didn’t necessarily think that Bitcoin would reach $1 million in the next 90 days. The mid-term definitely, but just not within 90 days. He wanted to make a bold headline that would grab everyone’s attention. He wanted to try and save as many people as he possibly could. The people that were not only paying attention to Balaji’s bet but also the banking and macro events currently happening. They have clearly gotten the hint and have begun to exit to Bitcoin. That is why Bitcoin has gone from a price of $17k to $31k during this whole fiasco. It’s likely that Bitcoin will go up even further. The only question is have you been preparing for the worst possible outcome? Have you exited to Bitcoin?
How about you? Do you think Balaji’s Bitcoin was a failure?
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As always, thank you for reading!
