Balaji Bitcoin Bet Needed a 3500% Rally – But Was It Just About the Money

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Disclaimer: The information presented does not constitute financial, investment, trading or other advice and reflects the opinions of the authors only.

The Balajis Bitcoin bet was never just about price. Bitcoin to $1.2 million by 2029, according to our bold predictions (take it with a bucket of salt).

In March, former Coinbase CTO and cryptocurrency advocate Balaji Srinivasan bet that Bitcoin [BTC] would hit $1 million in mid-June. When the bet was made, he insisted that the US economy would soon enter hyperinflation. Later in March, he warned that hyperbitcoinization could happen faster than expected if the government continues to print money and lie about how much banks have.

Read bitcoins [BTC] Price Prediction 2023-24

The bet was closed on May 2 by mutual agreement. Mr. Srinivasan made three provable donations of $500,000 on-chain to Bitcoin Core Development, GiveDirectly and Medlock, the person he made the initial bet to. But why did he burn his own money by making an impossible bet?

Burn personal money for a public cause

Balaji claimed the reason behind the bet was to force a public discourse by sending a costly signal that something is wrong with the economy. Balaji says we can’t rely on public figures to let us know when something is wrong, citing the actions of Janet Ellen and Ben Bernankes in 2008. The 2008 crisis was far bigger than Bernanke had anticipated, because he had only called it a minor recession five months earlier. the crash.

This time around, Balaji is confident that we won’t get the soft landing that Federal Reserve Chairman Jerome Powell promised in late March. According to Balaji, the huge sums of money injected by the US Reserve were leading to runaway inflation, and the result will be far worse than what Powell said. He thinks the only safe haven is bitcoin and he burned a million to tell you they print trillions.

Must be nice having a million dollars to burn like that. Balaji says he did this for the public good and citizens cannot rely on public figures to shout the truth. The rapid depreciation of the dollar could see investors flock to Bitcoin, leading to hyperbitcoinization.

Bitcoin’s market capitalization stands at $517.8 million at the time of writing. The amount of BTC in circulation was 19,385,012, with more mining approximately every ten minutes. With a price of 1 million, the market capitalization of BTC would amount to $19.38 trillion, close to China’s GDP in 2022 ($18.1 trillion).

Rallies and Retracement Cycles

Source: BTC/USD on TradingView

The chart above shows bullish rallies (white) in 2017 and 2021, and bear market rallies (orange) in 2019 and 2023. The bullish rallies measured 2135% and 1688% respectively, although the second rally took a lot more time. Almost twice as long, as it took 430 days after prices stabilized around the $10,000 mark before BTC hit the ATH at $69,000 on Coinbase.

From the highs of the bear market rally, BTC fell back to the 78.6% Fibonacci retracement level 280 days later during the Covid crash. If history were to repeat itself, we would expect BTC to fall to $18,800 in January 2024 before rising again.

Conservatively estimating, if the price made another 1,680% rally from $18,800, it would reach $315,840 after about 400-450 days, which would mean June 2025. An 80% pullback 380 days later would bring Bitcoin at $63,168 in July 2026.

Assuming the same pattern repeats, i.e. a bear market rally measuring 100% within five months, BTC would be trading at $126,000 in December 2026. Since we are only comparing the 2017 and 2021 cycles , estimate that BTC suffers another 78.6% retracement of the bear market rally over the next 280 days.

Mark the dates in your calendar, buy BTC and go on a multi-year world tour

This would mean that Bitcoin would hit $76.5,000 in August or September 2027. Another 1680% rally after almost 500 days would take BTC to $1.28 million in February 2029. That would be a crazy trip for long hodlers. BTC term. Even more so for people who have held BTC through thick and thin for over a decade.

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Of course, the above conjecture is just a guessing game, assuming BTC does something like the 2021 cycle over and over again. not as far north and the rally time was longer in 2021 than in 2017. If this were the case for the next decade, it could take much longer for BTC to hit $1 million. six more paltry years. If ever Bitcoin hits $1 million.

Balajis’ bet was ridiculous if we think his only intention was a BTC price prediction like the one made by John McAfee years ago. However, he clarified that he had given his money to shed light on something much more important that was happening in the economic context.

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