Generation X billionaire businessman Ken Griffin says he thinks the “passion is misplaced when it comes to cryptocurrencies”.
Billionaire CEO of American hedge fund Citadel Kenneth Griffin thinks a currency on the Ethereum (ETH) network will replace Bitcoin (BTC) as crypto’s top dog. Citadel manages over $40 billion of capital — a quarter of the trading volume in the US stock market.
During this Wednesday’s Nov. 10 DealBook summit hosted by The New York Times, Griffin said that he anticipates that the “Bitcoin-based conception [will be] replaced by the Ethereum-based conception in the next generation of cryptocurrencies.”
He added that Ethereum-based cryptocurrencies have “the benefits of higher transaction speeds [and] lower cost per transaction.”
Ethereum is only slightly faster than Bitcoin at present, but will significantly scale up transaction speeds and lower costs when Eth2 is fully implemented.
Griffin is a long-time crypto sceptic, especially of Bitcoin — which he claims there are “no commercial use cases for.”
Although he noted that crypto and its underlying blockchain technology is a “really interesting technology” and “a powerful way to maintain a decentralized ledger around the world,” he ultimately said that “for most problems, it’s really not the solution that we need.”
“People are very focused on a world of new ideas and new creation,” he said, “I worry that some of this passion is misplaced when it comes to cryptocurrencies.”
During the summit, he claimed that “there’s a number of issues that haven’t been addressed by crypto,” including the risk of fraud, high costs, and energy expenditure.
“Bitcoin is incredibly expensive to manage payments on,” he said. It currently costs approximately $4.1 per Bitcoin transaction. Typical credit card transaction fees range from 1.4% and 3.5% on popular networks such as Mastercard, Visa and American Express. The recommended surcharge cost for debit cards is around 0.5%.
In terms of sustainability, Griffin claimed that Bitcoin is “a bigger contributor to global warming than any form of payment we use around the world today in aggregate.”
Bitcoin’s annual carbon footprint is around 90.48 tonnes of CO2. Each Bitcoin transaction has the equivalent carbon footprint of 2,008,657 VISA transactions, according to the Bitcoin Energy Consumption Index.
On the flip side, Bitcoin mining also utilizes the lowest cost forms of energy, such as renewable energy and surplus power that would otherwise be wasted. It is also significantly more difficult to actually quantify the number of emissions that banks and financial institutions are responsible for.
When asked if he was concerned that he may have already missed the crypto train, he said: “I think that the train is, in some sense, still in the station…. I think it’s very much in the early innings still.”
Earlier this year, there were rumours claiming Citadel was behind the trading limits placed on Robinhood for Gamestock shares. He denied any personal involvement in the saga during the summit, calling it a “bad comedy joke,”