In a courageous move, Balaji Srinivasan, a software company founder, accepted the wager of James Medlock, a social democrat, who wagered $1M that the United States would not enter hyperinflation. Srinivasan’s acceptance of the wager was a daring move. The wager on one Bitcoin (BTC) was accepted by Srinivasan, who was offered odds of 40 to 1, and the wager lasted for ninety days.
Digital dollar devaluation dilemma
Srinivasan noted needing a mutually agreed upon custodian to ensure the bet’s payout if the digital currency loses value. The creator of the technology company also brought up the option of carrying out the stake via a smart contract, which would enable the usage of USDC stablecoin rather than US dollars. Notwithstanding this, Srinivasan challenged Medlock, demanding that he identify a custodian for the asset if he hesitated to employ a smart contract.
I will take that bet.
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/tcuBNd679T pic.twitter.com/6Aav9KeJpe
— Balaji (@balajis) March 17, 2023
The post aroused a lot of attention in the crypto community, with many people debating whether or not such a bet is possible and its possible dangers and benefits.
Even though Srinivasan accepted the bet, he contended that banks and regulators have been lying to depositors and holders of dollars about the bankruptcy of banks, much in the same way that they did during the financial crisis of 2008. The expert believes that the banking crisis was caused by the use of deposits by financial institutions to purchase long-term US Treasuries, which the Federal Reserve Bank then devalued.
Tech founder’s Bitcoin recommendation
The creator of the software company said that investors who bet on long-term Treasuries lost everything in 2021, and those who depended on short-term Treasuries would lose everything in 2023 in the same way. As a preventative precaution against experiencing monetary loss, he suggests investing in Bitcoin and removing coins from exchanges.
After the failure of three of the country’s most well-known banks, the federal government of the United States is said to have lately “created out of thin air” the sum of $300 billion to provide a bailout for the industry.