Balaji Srinivasan Doesn’t Backtrack on Massive Bitcoin (BTC) Bet as Likelihood of US Debt Default Rises

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Balaji Srinivasan says he is not backing down from his bold call that Bitcoin (BTC) will explode to $1,000,000 following a US economic crisis.

In March, the former Coinbase executive bet that Bitcoin would hit $1 million within three months, largely due to bank failures and hyperinflation.

He previously said that bank runs happen much faster today, given that we live in a digital world.

I think we see an exit from the US banking system towards Bitcoin over the next few weeks and months and maybe years to come.

The exact deadline of 90 days? You know, I don’t think it’s impossible for that to happen given how quickly digital banks work, but directionally it’s a lot easier. The timing is difficult, the preparation is easy.

While many interpreted Srinivasans’ bet as a statement or a publicity stunt, he says he has no plans to back down on his appeal.

Don’t back down from anything. I said 10% chance of a fiduciary crisis occurring in months, 70% chance in years, 19% chance in decades, 1% chance in centuries. But 10% is very high and worth pointing out. Others also believe that the probability of a sovereign default has never been higher.

The Bitcoin bull also points out that the likelihood of a US sovereign default has recently reached all-time highs, potentially bolstering its side of the bet. He shares a chart showing that the price of credit default swaps (CDS) on US 1-year bonds has been skyrocketing lately.

I had to sort out the legal details, but look for a bet update soon.

Meanwhile, markets also placed the probability of US sovereign default at record highs. And that’s just an explicit default driven by the debt ceiling. Does not include all avenues of debt monetization.

Source: Balaji Srinivasan/Twitter

Analysts at Morgan Stanley Capital International (MSCI) have warned that the effects of a US default on its debt could be potentially catastrophic.

The consequences of a potential US government default go beyond the immediate impact on Treasury bond holders. Major market dislocation and a sharp slowdown in economic activity could be realistic possibilities.

At the time of writing, Bitcoin is trading at $29,376, almost 3,000% off Srinivasans’ $1 million call.

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