Balaji's Bet: Bitcoin hits $1 million in 90 days

Why is venture capitalist Balaji Srinivasan betting $2 million that a Bitcoin will be worth $1 million within 90 days? Join our conversation about the state of banking and the U.S. dollar with Srinivasan and economist Lawrence White, author of Better Money: Gold, Fiat, or Bitcoin? Hosted by Reason's Zach Weissmueller.

"You buy 1 BTC. I will send $1M USD."

Those were the stakes that venture capitalist Balaji Srinivasan proposed over Twitter to pseudonymous writer and self-described "tax enthusiast" James Medlock on March 17. The bet? Within 90 days, one bitcoin will be worth $1 million.

Medlock, who had jokingly tweeted earlier that he would "bet anyone $1 million dollars that the US does not enter hyperinflation," quickly accepted the terms. With bitcoin hovering around $26,000, Srinivasan had made an approximately 38–1 wager that "hyperbitcoinization" would unfold over the next three months as the Federal Reserve devalued the U.S. dollar to backstop the nation's shaky banks with new infusions of cash.

Critics have said the bet is a promotional ploy to launch a new media brand or to pump the price of bitcoin to increase the value of his holdings. His doubters include George Mason University economist Tyler Cowen, who predicts that "the US will muddle through its current problems and patch up the present at the expense of the future," and bitcoin mega-booster Saifedean Ammous, author of The Bitcoin Standard, who writes "I feel dirty sounding bearish on bitcoin, but I do not think bitcoin will hit $1m in 90 days & and I do not think the dollar can possibly hyperinflate this quickly."

So what is Srinivasan thinking?

Find out this Thursday at 1 p.m. Eastern as Srinivasan joins Reason's Zach Weissmueller and economist Lawrence White, author of Better Money: Gold, Fiat, or Bitcoin? to discuss the bet and their analyses of the state of the U.S. banking system.

Show notes:
Balaji Srinivasan’s bet with James Medlock - https://twitter.com/balajis/status/1636822077775941633

Federal Reserve to provide additional funds for banks, backstopped with $25 billion from the Treasury - https://archive.is/qrZYB#selection-4839.93-4839.251

Bloomberg: Fed could inject up to $2 trillion - https://www.bloomberg.com/news/articles/2023-03-16/jpmorgan-says-fed-s-loans-will-provide-2-trillion-of-liquidity

Study on uninsured bank deposits in 2023 - https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4387676

Bloomberg: Fed discount window lending surpasses $164 billion -https://www.bloomberg.com/news/articles/2023-03-16/banks-rush-to-backstop-liquidity-borrow-164-8-billion-from-fed#xj4y7vzkg

St. Louis Fed: Fed balance sheet since 2004 - https://fred.stlouisfed.org/graph/?id=WALCL,

Tyler Cowen: The banking crisis won’t wreck the economy - https://marginalrevolution.com/marginalrevolution/2023/03/this-banking-crisis-wont-wreck-the-economy.html

Ammous Safeidean: A bank crisis is deflationary - https://twitter.com/saifedean/status/1638453109033664513

FedNow Service launches in July: https://www.federalreserve.gov/newsevents/pressreleases/other20230315a.htm

Jerome Powell addresses banking crisis and rate hikes - https://www.youtube.com/watch?v=WK6EfnYkejc

Janet Yellen voices concern for a ‘few’ banks - https://www.youtube.com/live/je-6S97KKqY?feature=share&t=4049

DeSantis announced Digital Bill of Rights - https://www.youtube.com/watch?v=mLPcqRS8978