The former Coinbase exec settled the high profile wager 45 days ahead of time but remains convinced that a “fiat crisis” is inevitable.
A $1 million Bitcoin (BTC) price bet has been closed out 97% under its target price, with backer Balaji Srinivasan choosing instead to donate a total of $1.5 million to three different entities as a settlement.
On May 2, Srinivasan, the former chief technology officer at Coinbase, said the bet had been “closed out by mutual agreement” 45 days ahead of time.
As a settlement, Srinivasan paid pseudonymous Twitter user and self-titled “hyperinflation doubter” James Medlock $500,000, donated $500,000 to Bitcoin Core developers and gave an additional $500,000 to the non-profit charity Give Directly.
I just burned a million to tell you they're printing trillions. pic.twitter.com/pX5622rjUO
— Balaji (@balajis) May 2, 2023
“I settled the bet ahead of time and donated even more than I had committed,” Srinivasan tweeted.
“I’m not in the habit of publicly burning a million bucks,” Srinivasan added, explaining the reason for closing out the wager around $970,000 below his target price of a $1 million per Bitcoin was because he believes “in the public good” and citizens can no longer “rely on the public sector […] to tell us when something's wrong.”
“I spent my own money to send a provably costly signal that there’s something wrong with the economy, and that it's not going to be a ‘soft landing’ like Powell promises — but something much worse.”
Despite giving away a total of $1.5 million, Srinivasan remains convinced the American economy will eventually reach a state of hyperinflation. Under his view, investors will rush to secure the value of their rapidly-depreciating dollars in Bitcoin, rapidly driving the value of the asset to reach a price of $1 million.
The high-profile wager was initiated on March 17 following a disagreement between Srinivasan and pseudonymous Twitter user James Medlock. Medlock initially tweeted that he would bet someone $1 million that the U.S. dollar would not enter any state of hyperinflation.
Related: How can Bitcoin hold $28K amid the banking crisis?
The conditions of the bet stipulated that if Bitcoin’s price failed to reach $1 million by June 17, Medlock would receive $1 million in the dollar-pegged stablecoin USD Coin (USDC) as well as an additional 1 BTC. On the contrary, if the price of an individual Bitcoin were to be valued at $1 million by the same date, then Balaji could keep the 1 BTC and the $1 million in USDC.
I will take that bet.
— Balaji (@balajis) March 17, 2023
You buy 1 BTC.
I will send $1M USD.
This is ~40:1 odds as 1 BTC is worth ~$26k.
The term is 90 days.
All we need is a mutually agreed custodian who will still be there to settle this in the event of digital dollar devaluation.
If someone knows how to do this… https://t.co/hhPr522PQu pic.twitter.com/6Aav9KeJpe
Bitcoin is currently trading for just over $28,700 and has a market capitalization of $556 billion, according to Cointelegraph data.
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