Kenneth Griffin, the billionaire CEO of the American hedge fund Citadel, believes that a currency based on the Ethereum network would dethrone Bitcoin (BTC) as the cryptocurrency’s top dog. Citadel controls more than $40 billion in funds, accounting for one-quarter of the trading volume in the US stock market.
Griffin stated at The New York Times’ DealBook event on Wednesday, Nov. 10, that he believes the “Bitcoin-based vision [would] be supplanted by the Ethereum-based conception in the next generation of cryptocurrencies.”
He went on to say that Ethereum-based cryptocurrencies had “the benefits of faster transaction speeds [and] reduced transaction costs per transaction.”
Ethereum is now only marginally quicker than Bitcoin, but when Ethereum 2.0 is completely deployed, transaction speeds and prices will drastically increase.
Griffin has long been a critic of cryptocurrency, particularly Bitcoin, which he believes has “no commercial use cases.”
Although he acknowledged that cryptocurrency and its underlying blockchain technology are a “very intriguing technology” and “a powerful mechanism to maintain a decentralized ledger throughout the world,” he concluded that “for most situations, it’s really not the solution that we need.”
“People are highly focused on a world of new ideas and new creativity,” he continued, “and I am concerned that part of this passion is misguided when it comes to cryptocurrencies.”
During the conference, he stated that “there are a number of challenges that crypto hasn’t solved,” such as the possibility of fraud, high fees, and energy waste.
“It’s tremendously expensive to manage payments on Bitcoin,” he remarked. At the moment, each Bitcoin transaction costs about $4.1 USD. On prominent networks such as Mastercard, Visa, and American Express, typical credit card transaction fees range between 1.4 percent and 3.5 percent. For debit cards, the recommended fee cost is roughly 0.5 percent.
Griffin asserted that Bitcoin is “a larger contributor to global warming than any form of payment we use throughout the world now in aggregate.”
The yearly carbon footprint of Bitcoin is about 90.48 tonnes of CO2. According to the Bitcoin Energy Consumption Index, each Bitcoin transaction has the carbon footprint of 2,008,657 Visa transactions.
Bitcoin mining, on the other hand, uses the least expensive kinds of energy, such as renewable energy and surplus electricity that would otherwise be squandered. It is also substantially more difficult to calculate the quantity of emissions caused by banks and financial firms.