According to Ken Griffin, the founder of a large hedge fund Citadel LLC, bitcoin has a number of serious flaws that could lead to the fact that other cryptocurrencies will take its place.
In a recent interview with Andrew Ross Sorkin of DealBook, Ken Griffin expressed the opinion that bitcoin is too harmful to the environment, has slow transaction speeds and is vulnerable to fraud.
Griffin acknowledges that bitcoin’s value has more than doubled this year and continues to rise as institutional investors use the asset to hedge inflation risks. Additionally, Bitcoin became legal tender in El Salvador in September, making its way nationally.
However, Griffin continues to be skeptical about Bitcoin and its use cases. He believes that ether, or another cryptocurrency based on his blockchain with a lower carbon footprint and lower transaction costs, will displace Bitcoin and become the dominant asset in the industry.
The founder of hedge fund Citadel also touched upon the growing inflation and financial crisis that affected the economies of most countries. He expressed doubts that cryptocurrencies would be able to solve global financial problems and hinted that the US state digital currency could be more effective in this initiative.
At the same time, Griffin sees the potential of blockchain, calling it “a really interesting technology and a powerful way of maintaining a distributed ledger around the world.”
Rahul Rai, the manager of the BlockTower Capital cryptocurrency fund, also supports Griffin’s opinion. He is confident that if the ether manages to restart the global financial system, then in the future its capitalization will be greater than that of bitcoin. Analysts at the American investment bank JPMorgan also believe that bitcoin will give way to ether in the long term.