Angel investor Balaji Srinivasan has warned that the recent collapse of cryptocurrency exchange FTX should not be considered a failure, but rather a preview of potential state failure. He cautioned that US dollar bank accounts could one day “be frozen or inflated to worthlessness” and that authorities “will show no interest in prosecuting”. Srinivasan urged the need for alternatives: “That world is coming and we need to be prepared.”
Balaji Srinivasan Predicts State Collapse, USD Becoming Worthless
Angel investor Balaji Srinivasan made a series of tweets on Saturday in response to the collapse of cryptocurrency exchange FTX. Formerly CTO of Coinbase and general partner in venture capital firm Andreessen Horowitz (a16z), Srinivasan is the author of The Network State and a Wall Street Journal Bestseller.
“Treat FTX as a preview of state failure,” he wrote. “One Day, your USD bank account balance might be frozen or inflated to an unimaginable value. The authorities won’t pursue charges because they ordered it. That world is changing and we need to be ready.”
Everything is just a dress rehearsal for the last rug pull: when the state prints trillions, monetizes the debt and ends the fiat century. Our space will be prepared. We know what that looks like. And our trust-minimizing systems will be life rafts for the world.
Many Twitter users agreed with Srinivasan’s assessment, saying that Bitcoin and decentralization are the solution.
However, others disagreed with the businessman, claiming that FTX was a fraud or Ponzi scheme. “It is not a foretaste of state failure,” one wrote. “It has nothing to do with that. It’s just fraud.” Another questioned how Srinivasan could equate a 32 year old con man with the US government. A third opined: “Comparing the regulated banking industry to the unregulated crypto exchange is misleading.”
In another tweet, Srinivasan also discussed Bitcoin as an inflation hedge. He detailed:
It is used to hedge against hyperinflation and currency debasement, wealth seizure, and bank freezes. In places like Venezuela, Lebanon, and Nigeria. For standard inflation, it could eventually play a similar role to gold, but that will take decades to prove.
What do you think about Balaji Srinivasan’s views on FTX and Bitcoin? Let us know your thoughts in the comments section.
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