Ex-Coinbase CTO clears the air on his $2 million Hyperbitcoinization effort
Former Coinbase CTO and venture capitalist Balaji Srinivasan has many skeptical of his latest prediction that Bitcoin will rise to $1 million within 90 days. What could he really be after with such a bullish public effort?
On Tuesday, Balaji explained that his $2 million gamble is not about making money, but about settling an “ideological issue” over US dollar inflation.
The pressure is coming
In a chirping response to angel investor Jason Calcanis on Tuesday, Balaji clarified that last week’s bet was not originally suggested by him, but by James Medlock on Twitter. Medlock, who was surprised to see anyone take up the offer, later called the “most profitable piece of crap in history.”
“I think Medlock would agree that this is an ideological bet, like the Simon-Ehrlich bet, that settled a well-known difference of opinion between libertarians and progressives,” Balaji wrote.
The Simon Erlich bet was a bet between professors Julian Simon and Paul Ehrlich in 1980 to settle their conflicting theories surrounding human overpopulation and resource scarcity. Simon, who argued that the human race would not be driven to poverty and famine by overpopulation, eventually won the bet, with Ehrlich sending him a check for $576 in October 1990.
Balaji’s theory of “hyperbitcoinization” predicts an overwhelming flow of capital into Bitcoin as the Federal Reserve injects trillions of dollars into the economy to protect the banking system. As he says, others including Jack Dorsey have predicted short-term hyperinflation for the US dollar in recent years.
The former CTO said that he has publicly committed to never sell his Bitcoin for USD unless legally forced to do so, and that he no longer has faith in the US banking system.
“Unfortunately, I am not alone in this loss of faith in American banking,” he continued. cites Moody’s negative outlook for the banking system released earlier this month, and the very latest wave in Chinese bank shares over global competitors. “If the USD fails, the free world needs BTC as a reserve currency, not RMB,” he said.
Is Balaji right?
Numerous critics have claimed Balaji’s predictions as overzealous, if not outright self-interested. Demtri Kofinas on Twitter called Balaji’s claims about rising Chinese banks are a “lie” and his predictions about USD hyperinflation “ideologically driven and ignorant”.
Still, certain Bitcoin bulls don’t find it so unreasonable: BitMEX co-founder Arthur Hayes has predicted that the Federal Reserve’s new Bank Term Funding Program will result in “endless money printing,” while Strike Chief Jack Mallers so on Monday that the Federal Reserve is “blowing up the financial system”.
Others, however, think it’s all a publicity stunt:
“I don’t do John McAfee-like stunts. I’m an ideologically driven person who believes in Bitcoin and anyone who knows me can testify to this,” concluded Balaji.
