American hedge fund manager, investor and entrepreneur Ken Griffin predicts big changes for Ethereum and Bitcoin. He believes Ethereum and its conceptual design might replace Bitcoin. But ultimately, both would be replaced by the next generation cryptos, which feature higher transaction speeds and lower costs.
Just last week, many cryptocurrencies reached new all-time high. Bitcoin peaked at $68,530, while Ethereum reached $4,743. However, current market performance shows bearish trading. At the time of writing, Bitcoin is trading at $59,030 and Ethereum is at $4,106, per Coindesk.
On the recent DealBook Online Summit, Griffin explained his views on cryptocurrency market trend.
Billionaire Issues Warning About Bitcoin Price
Bitcoin is the largest cryptocurrency up to date. Its coin currently costs multiple times more than any other cryptocurrency available. However, Bitcoin has its weaknesses. Its system is expensive to manage, and its hardware is a major contributor to global warming. Because of this, Griffin said investors might take an interest in different cryptocurrency markets.
Ethereum, on the other hand, uses a programmable ecosystem that features both smart contracts and proof-of-stake. It also features block-chain based decentralized finance (DeFi) and non-fungible tokens (NFT) functionality. Both these industries are effective promotions to the digital payments lifestyle. This is why Griffin believes that ETH could overtake Bitcoin in the long run.
Unfortunately, ETH also has its fair share of weaknesses. Transaction speeds are extremely slow, and the cost per transaction is expensive. If new generation coins could properly fix this issue, then they might quickly replace Ethereum in the market.
Read also: Shiba Inu Price Update: Cryptocurrency Value Declining; Does Elon Musk Have the Meme Coin?
Bitcoin Price Prediction: The Future of Crypto
However, regardless of which crypto coin emerges dominant, Griffin emphasized the security risks of cryptocurrency. He said, "a number of issues that haven't been addressed by crypto (is) how payments will be made more efficient," per Forbes. Griffin explained that the lack of security might discourage future businesses and customers from using the digital mode of payment.
As an example, Griffin compared cryptocurrency to card companies like Visa and Mastercard. Based on the contract conditions, these companies said they are willing to cover costs against fraud and theft. On the other hand, cryptocurrencies offer no such benefit. This means investors and businesses have to be accountable for their own money and safety.
Griffin pointed out that the pandemic-induced lockdowns might have boosted the financial systems temporarily. "(The pandemic) created a whole new class of savers because we couldn't spend money a year ago, like the meme stocks and like cryptocurrency. People are very focused on the world of new ideas and new creations. I worry that some of this passion is misplaced when it comes to cryptocurrencies," per Forbes.
The last thing to note about cryptocurrency is its highly volatile market. Its values often rise and fall without any indication, so readers should take Griffin's prediction with some pinch of salt.
