On Friday, Coinbase’s former CTO Balaji Srinivasan predicted that a significant dollar devaluation in the next three months will boost Bitcoin’s price to $1 million by June 17.
That day, Srinivasan wagered $1 million with pseudonymous Twitter commentator James Medlock and another anonymous person. If Bitcoin fails to make historic gains, each would receive $1 million in Circle’s USDC stablecoin. Srinivasan’s “hyperbitcoinization” theory underpins the bet. The global economy will “redenominate on Bitcoin as digital gold” after the U.S. dollar hyperinflates.
According to CoinGecko, Bitcoin, the largest token, would rise to $19.3 trillion from $549 billion. According to Siblis Research, the U.S. stock market was worth $40.5 trillion last year.
Srinivasan’s prognosis comes after U.S. bank failures that have spooked financial markets. Given Bitcoin’s recent run beyond $28,000 as Wall Street falters, some on Twitter are calling it “The Great Decoupling.”
Jimmy Song, a Bitcoin entrepreneur and lecturer, and Adam Cochran, a venture capitalist, debated the prediction on Twitter. Cochran said Bitcoin would need a stimulus stronger than the 2020 coronavirus pandemic to surpass the 547% rally from 2020 to 2022.
Cochran believed that a collapse of the US and European banking institutions would outweigh Bitcoin’s potential worth, making bunkers or beans a superior investment.
He told Decrypt over Twitter DM that stores of value or alternative assets do well when we doubt the profitability of an economic system, not its existence. “Without the system, we value necessities over valuables.”
Cochran said Srinivasan’s bet gives the crypto market hope following last year’s crypto winter, when values plunged and many crypto enterprises collapsed. He said the digital assets industry lost its excitement and optimism.
“They want that back,” he said. “It’s distressing to see it fueled by an unreasonable bet in such a perilous macro environment.” Song and others supported Srinivasan’s gamble, arguing that Bitcoin may be useful during a banking system collapse. “Bitcoin will mitigate some of the disastrous effects,” he claimed. Bitcoin reduces hyperinflation since it is restricted.
On Saturday, Bloomberg’s Matt Levine asked a simple question: If Srinivasan thinks Bitcoin will hit $1 million in 90 days, why bet instead of buying it?
Based on the responses, Levine tweeted that Srinivasan may be trying to “manipulate the price [of Bitcoin] higher.” Some suggested Srinivasan made the bet to promote himself and Bitcoin.
Datawallet values Srinivasan at $150 million. After Coinbase bought Earn.com, a firm he co-founded, he joined. Srinivasan left Coinbase in May 2019 after 14 months. He organized Circle’s USDC stablecoin launch’s “commercial and technical sides,” according to his LinkedIn profile. Not just Srinivasan has predicted a $1 million Bitcoin price. In January 2018, Cathie Wood’s ARK Invest predicted that Bitcoin may reach $1 million by 2030 because the network “is expected to scale as nation-states adopt [Bitcoin] as legal cash.”
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