“Mr. I-Put-My-Money-Where-My-Mouth-Is.”
Balaji’s insane $1M Bitcoin Bet!
Tomorrow, Thursday, March 23rd… right before March Madness resumes….
I will publish STEP #2 of my Create & Manage Your Own “Bitcoin Bank" post.
While it should be evident by now that my Bulletins are in no way, shape, or form centered around crypto… I do have a personal interest in the space.
And, by proxy, in helping my fellow Bear cub readers DO things, outside the mainstream, with their money… as represented by the digital 1’s & O’s you see when logging into any platform that houses them.
Yes, in 2023, useable “money” has become that simple, and diddled down to just that: online 1’s & Os!
Stay tuned tomorrow, as I will release a show ‘n tell screencast video highlighting the three platforms you can effectively use to create your own hybrid online “bitcoin bank.”
But today, let me pass along a most excellent post, from the gnarly men & women at the Milk Road. This will give you a taste of what they report on every day.
This story, from Monday, alone had me smiling (with my tongue in my cheek):
From Milk Road
(Subscribe here… for what matters in Crypto)
Everyone was talking about one thing this [past] weekend… Balaji’s $1M Bitcoin Bets.
If you don’t know Balaji, he:
Sold his genetic testing company for $300M+ and later was CTO of Coinbase
Predicted stuff like: how COVID-19 would play out (lock-downs, etc.) and how pseudonyms would become a huge trend (i.e., separating real & digital identities)
Reads textbooks for fun (nerd)
When Balaji speaks, people stop, drop, and roll to listen. And now, he’s back with another prediction...
1 Bitcoin will be worth $1M+ in 90 days. And he’s backing up his talk by making two separate million-dollar bets that it will happen:
Balaji’s new nickname is “Mr. I-Put-My-Money-Where-My-Mouth-Is.”
So, why is Balaji so confident? Let’s dive in…
1/ U.S. banks are in trouble. Over the last few weeks, big banks like Silicon Valley Bank, Signature Bank, and Silvergate all collapsed.
Balaji thinks this is just the tip of the iceberg, as economists have found that 185+ other banks may be prone to similar risks, which could lead to…
2/ The U.S. government printing more money to save banks. With SVB, Signature, and Silvergate all falling within a week, the U.S. Federal Reserve created a new bank backstop program to prevent any more big failures.
J.P. Morgan estimates that the Fed could end up injecting up to $2T in new liquidity into the system.
Balaji believes that trillions of new dollars being printed will devalue the dollar and…
3/ This will lead to hyperinflation. This is when prices of services and goods skyrocket, while the value of the dollar plunges.
In other words, everything gets more expensive and we all get poorer. It’s a double whammy.
Hyperinflation happens fast, but Balaji argues that it’s even faster in today’s world. In the age of social media, viral tweets spread faster than wildfire, and we’ve seen it accelerate things like bank runs (i.e. Silicon Valley Bank saw $42B worth of withdrawals in 24h).
Balaji thinks all of this will lead to...
4/ People investing in Bitcoin as a hedge against inflation. With the value of the dollar plummeting, people will look towards an alternative asset to hedge against inflation.
Balaji believes BTC will be that asset, which will lead to a huge pump in Bitcoin's price.
More people buying Bitcoin = more buy pressure = Bitcoin to $1M (?)
So, do people agree with Balaji? Let's look at some of the best takes from Twitter...
💭 Milk Road Take:
We’re big fans of Balaji and think he’s brilliant, but…
This might be one of the dumbest bets we’ve ever seen. We would’ve been comfortable betting the house on the other side of this bet.
And it isn’t because we completely disagree with the reasoning, it’s just the timing & magnitude of the prediction that we disagree with.
In order for Balaji to win, Bitcoin would need to soar from $27.5k → $1M in 90 days. There's a better chance that Princeton wins the March Madness tournament than Bitcoin 36x'ing in 90 days.
It's a crazy bet. But there might be a Method for Balaji’s Madness: it got everyone's attention.
If Balaji said BTC's price would only hit $100k or if he only bet $100k on it, it wouldn't have turned as many heads or made the news. But there's something about $1M that gets everyone's attention. (It's provocative, it gets the people going.)
Plus—he also set up a $1M contest for the best memes, graphs, charts, etc. that help raise the alarm on the issue. ($1,000 will go to the best 1,000 graphics.)
Who knows if Balaji will be right (again), but this looks like his Paul Revere moment.
Btw, here's the meme we're submitting...
- End article from Milk Road -
(Subscribe here… for what matters in Crypto)
Back to da Bear:
If you haven’t yet read my Create & Manage Your Own “Bitcoin Bank" post, be sure to do so now… before…. Thursday, March 23rd.
And, extra credit for watching this YT deep dive, on this post’s topic: