Concerns about United States inflation and its impact on Bitcoin (BTC) prices are at the forefront of investors’ minds globally. A prominent figure in the crypto world, former Coinbase executive, recently paid $1.5 million to settle a Twitter bet on the possibility of hyperinflation in the US economy.
Although hyperinflation hasn’t occurred yet, the Federal Reserve seems concerned about prices spiraling out of control. On May 3, the Fed raised interest rates by a quarter-point, the highest level in 16 years, pushing the target range for its benchmark from 5% to 5.25%. As inflationary pressures continue, several crypto firms depend on Bitcoin as a safe haven to fight inflation and chaos in mainstream finance.
This week’s Crypto Biz covers the latest wager on Bitcoin prices, inflationary concerns, and how artificial intelligence may soon replace several jobs.
Balaji pays out his crazy $1 million Bitcoin bet, 97% under price target
The highly anticipated wager between former Coinbase CTO, Balaji Srinivasan, and anonymous Twitter user James Medlock has ended with Srinivasan paying $1.5 million to settle the bet. The bet began on March 17 when Medlock offered a $1 million wager, claiming that the US wouldn’t experience hyperinflation. Shortly after, the former Coinbase executive accepted the challenge, stating that an impending crisis would result in the US dollar’s deflation and, therefore, a hyperinflationary event, taking the BTC price to $1 million. As part of their deal, Srinivasan paid Medlock $500,000, donated $500,000 to Bitcoin core developers, and gave another $500,000 to the nonprofit charity, Give Directly.
I just burned a million to tell you they’re printing trillions. pic.twitter.com/pX5622rjUO
— Balaji (@balajis) May 2, 2023
MicroStrategy’s Bitcoin conviction ‘strong’ as it posts Q1 profit
MicroStrategy’s Bitcoin investment strategy remains robust, with the company posting its first quarterly profit since 2020. The firm reported a profit of $94 million, mainly attributed to a one-time income tax benefit of $453.2 million. MicroStrategy further cut its leverage by paying off a $161 million Bitcoin-backed loan from the now-defunct Silverage Bank. The quarterly results were also boosted by a revenue increase of 2.2% from last year to $121.9 million. CEO Phong Lee stated that the company would continue to execute its strategy of expanding its business intelligence software and acquiring Bitcoin, believing that its Bitcoin thesis is a “pretty good way to outperform the market.”
Since @MicroStrategy adopted a #Bitcoin Strategy: pic.twitter.com/rrYTbvOkUS
— Michael Saylor⚡️ (@saylor) May 1, 2023
Coinbase stock will be ‘weighed down’ until US rules are clear: Citi
Coinbase’s stock price will continue to be “weighed down” until regulators lay down the legal framework in the United States, according to Citi analysts. The bank downgraded the crypto exchange’s shares from “buy” to “neutral” and reduced its price target, citing too many unknowns as the company battles it out with regulators. Nevertheless, investment firm ARK Invest isn’t deterred by bearish sentiment on Coinbase’s stock. ARK bought 168,869 Coinbase shares worth nearly $8.5 million on May 1, and 304,300 shares worth $17.5 million in April. In March, the firm acquired 2.4 million shares for approximately $117 million.
Citi’s analysis was published before Coinbase’s Q1 earnings report on May 4.
7,800 jobs at IBM could be replaced by AI within years, CEO suggests
IBM expects to stop hiring for back-office roles that can potentially be automated by artificial intelligence. According to CEO Arvind Krishna, back-office positions like human resources and accounting departments will likely be the first to be replaced by AI. Krishna claims that almost 30% of these positions will be “easily” replaced by AI in the next five years. According to LinkedIn data, IBM employs 282,000 people globally, with nearly 26,000 in non-customer-facing roles.
Dropbox: Laying off 500 people and replacing them with AI
IBM: Pausing hiring for ~7,800 roles that could be done by AI
AI is already replacing jobs
— Genevieve Roch-Decter, CFA (@GRDecter) May 1, 2023
Before you go: The average person’s wealth will be ‘completely destroyed by inflation,’ says Arthur Hayes
The devaluation of money will progressively erode most people’s wealth, according to Arthur Hayes, co-founder and former CEO of crypto derivatives exchange BitMEX. He believes that the world’s largest economies will resort to inflating the vast public debt accumulated over the past years through money printing. With long-term inflation on the horizon, Hayes’ investment thesis focuses on preserving wealth through investing in digital assets. You can watch his exclusive interview with Cointelegraph on our YouTube channel.
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