Bitcoin to $1 million by June 16th
So, the crazy betting and prediction dates back to Friday 17th March The deadline will be June 16.
was in order to do so Balaji Srinivasanformer CTO of Coinbase as well as venture capital partner a16z, early investor in several successful crypto startups, and yes, Bitcoiner.
Although his opinion is very biased, it is completely pushed: according to him, we are about to encounter aUncontrollable hyperinflation.
The value of the dollar will drop very quickly, which makes any scarce commodity like gold, and of course, bitcoin attractive.
On the latter he makes an honest bet: $1 million bets that it will be worth the same by June 16th (an increase of about 3,600%).
Let’s see together what makes him think so.
The banking crisis is still in its infancy
“As in 2008, the banks lied.”
Thus begins a file A tweet in which Balaji explains his positionadding that the big problem is that banks don’t have enough reverse value in assets to cover it liquid assets of depositors.
all of that They have known for a long timewhich is the result of mismanagement of risks towards rising interest rates.
Banks bought large amounts of US bonds when interest rates were close to zero, and the value of the latter fell terribly in the wake of the aggressive monetary policies of the Federal Reserve.
Results? At present, the cumulative unrealized loss of various banks is almost $700 billion.
In the event of a bank run, as happened in the Silvergate and Silicon Valley Bank cases, institutions will be forced to sell assets to cover the need for liquidity, until those assets run out and bankruptcy occurs.
The latest maneuver by the Fed to stop this problem is outlined BTFP: Bank Term Financing Program.
It consists in guaranteeing these bonds and valuing them at par (at face value) to provide a liquid loan which is currently 300 billion.
It’s actually a slightly different shape than usual Quantitative easing: Liquidity is entered into the system, albeit on loan.
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“Like 2008, banks lied.”
Hyperinflation and hyperbitcoinization
In the The second part of Balaji’s tweet reveal the consequences.
According to him, hyperinflation should be defined in terms of Bitcoin: the amount of dollar depreciation against Bitcoin. Hence the term “excessive currency“.
Individuals, companies and finally countries too, according to him, They will buy bitcoins Consider it the only shield from the current scenario.
This trend has been going on since the 2008 crisis, when the value of one bitcoin rose from less than $1 to $25,000, and it’s only accelerating, according to Balaji.
Hyperinflation will happen quicklyjust as happened with the recent bank liquidations, which shook the entire banking system within a week.
This will bring the price of bitcoin to the price you predicted: $1 million within 90 days.
conclusions
Although some of the remarks made by Balaji are correct, they obviously have to Take with pliers expect it.
It’s a lot biased (It’s a very powerful bitcoin client), and it might be a marketing ploy to make itself better known.
Moreover, such an increase in such a short time is definitely a brave bet. In case you haven’t figured it out, it’s not to be taken seriously, let alone financial advice!
He’s putting a guarantee on a bet that already holds the (millionth) stake until it expires, so it looks like he’ll honor it.
How will it end? Only time will tell!
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