Kenneth Griffin, CEO of American hedge fund Citadel, said a currency on the Ethereum network would replace Bitcoin as the highest-value crypto at a DealBook summit hosted by The New York Times on Wednesday, November 10. Citadel manages more than a fourth of the US stock market trading volume, of which the capital equivalent is more than $40 billion.
Griffin stated:
The Bitcoin-based conception [will be] replaced by the Ethereum-based conception in the next generation of cryptocurrencies. Ethereum-based cryptocurrencies have the benefits of higher transaction speeds [and] lower cost per transaction.
With completion of Ethereum 2.0, the second-biggest crypto’s blockchain will process transactions much faster and at much lower costs. At the moment, it’s not much faster than Bitcoin. Still, Griffin has always been skeptic toward crypto, especially Bitcoin, for which he claims there are no commercial use cases.
Not the solution needed
According to the billionaire, Bitcoin is not the solution needed for most problems even though blockchain tech is a “really interesting technology” and “a powerful way to maintain a decentralized ledger around the world.” He added:
People are very focused on a world of new ideas and new creation. I worry that some of this passion is misplaced when it comes to cryptocurrencies. There’s a number of issues that haven’t been addressed by crypto, including the risk of fraud, high costs, and energy expenditure.
Too expensive for payment management, not sustainable
Griffin commented that Bitcoin was too expensive to manage payments on. At the moment, one BTC transaction costs approximately $4.1. In comparison, the highest credit card transaction fee on Visa, Mastercard, and AmEx is 3.5%. For debit cards, the recommended surcharge cost is only 0.5%.
He also criticized the flagship crypto over lack of sustainability, saying Bitcoin made the biggest contribution to global warming of all means of making payment worldwide combined. Its annual carbon footprint is around 90.48 tons of CO2, the equivalent of more than 2 million Visa transactions.
Challenges with quantifying bank-generated emissions
On the other hand, Bitcoin is mined using surplus power, renewable energy, and other forms that would otherwise go unused. It is challenging to quantify the emissions generated by traditional financial institutions like banks.
Train’s still in the station
Griffin was unapologetic when asked whether he was worried about having ‘missed the crypto train’, saying he believed the train hadn’t left the station.
