"I don't want to get shot in the nuts with a paintball gun from 10 feet away," Bauer told Jeff Passan on the Yahoo Sports MLB Podcast, when asked about the allure of signing one-year deals.
Bauer said the bet, which was made in 2012 or '13, is "a gentleman's agreement" between him and his best friend.
He later told Passan he knows his friend may not hold up his end of the bet, but he doesn't care because he has other reasons to take things year by year.
"There's no down side for me other than the money," Bauer explained. "I'm always going to be on a contender. I'm always going to have a chance to win a ring. I can stay loyal to one organization as long as they're willing to pay that and help them build their farm system, help them build their player development and all the stuff I'm interested in."
"What's the down side?"
The 27-year-old is unlike most pitchers in baseball, from his love for flying drones to his "69 Days of Giving" charity endeavors, so this type of bet isn't a surprising one to hear about.
Bauer owns a 2.45 ERA and 2.16 FIP, and is making $6.525 million this year.
He's eligible for arbitration in 2019 and will become a free agent following the completion of the 2020 season.