The U.S. government will likely seize citizens’ assets in an impending fiscal collapse – but Bitcoin will save the day when it happens, according to ex-Coinbase CTO Balaji Srinivasan.
The tech entrepreneur and Bitcoin bull, who forfeited $1.5 million in a high-profile bet on Bitcoin’s price last year, is again raising concerns about the United States’ seismic national debt and fiscal deficit, which could force the state to take drastic measures to stay solvent.
Why The Government Will Seize Our Property: Balaji
In a post to X on Sunday titled “Bitcoin > Budgeting,” Balaji highlighted the largely inefficient fiscal spending in blue states like California and San Francisco. The unaffordable spending, now having reached $10 billion+ per year in the latter state, has prepared the nation for a “financial reckoning.”
“En route to that, everything gets pulled into the black hole of a ravenous state. It starts with inflation and ends in confiscation… anything that can be seized will be consumed.”
The entrepreneur cited recent, famous examples of governments seizing the private property of others, including the US-led freeze on $600 billion in Russia’s foreign reserves, and Canada’s freeze on citizens’ bank accounts who were connected to the 2022 Freedom Convoy protest.
In the latter instance, protestors resorted to Bitcoin as an alternative source of fundraising, successfully transferring over 14 BTC to truckers after other donation methods had been blocked. Since Bitcoin is uncensorable and peer-to-peer, the asset cannot be confiscated unless another person knows the investors’ private key.
“Every asset on a DC-controlled ledger may get pulled into the maw, but Bitcoin holders *may* be unaffected,” Balaji wrote.
That said, the state may resort to the more difficult method of knocking on doors to seize assets. In that case, he believes the “Bitcoin maximalism” movement will win many converts.
“At least it’ll be obvious then that budgeting can’t save us,” he concluded. “Only Bitcoin can.”
Balaji’s $1 Million Bitcoin Bet
Balaji bet that Bitcoin could reach a price of $1 million per coin following the March 2023 banking crisis, which was followed by profligate spending from the Federal Reserve to bail out depositors.
The event convinced the investor that the U.S. government would resort to hyperinflation to bail out more insolvent banks and citizens crippled by student debt and credit card debt.
Though Balaji forfeited that prediction prematurely, and it ultimately didn’t come close to reality, BTC has reached a new all-time high above $72,000 per coin nearly a year after he placed his bet.
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