Appearing on Bloomberg, Kraken CEO Jesse Powell explained why he believes dollar-based long-term price predictions for Bitcoin are flawed, emphasizing the inflationary nature of fiat currencies.
Responding to a question asking Powell for end of year price predictions, Kraken’s CEO said: “I think I said Bitcoin is going to infinity and that’s kind of hard to comprehend because I’m measuring it in terms of dollars.”
Offering alternative measures for valuing Bitcoin, Powell speculated the value of Bitcoin may increase from its current 'price' or one BTC per Tesla Model 3 to “one Bitcoin per Lambo” by the end of the year, and to “one Bitcoin per Bugatti” by 2023. Powell added:
"To the crypto community, I think those kinds of assets are easier to measure Bitcoin against because you never know where the dollar is going to be. There could be 10 times as many U.S. dollars out there a year from now, so it’s really hard to measure Bitcoin against the dollar.”
While Bitcoin spent much of 2019 and the first half of 2020 trading for the price of a secondhand 2010 Honda Civic, one Bitcoin could have purchased a brand new Civic when the price broke into new all-time highs at the end of year.
When asked about Ethereum, Powell emphasized the importance of the booming non-fungible token sector, stating: “All of the NFT activity is really driving up the use of Ethereum.”
Powell also highlighted uncertainty surrounding when the Eth2 overhaul will be completed and noted that deposits to Ethereum’s staking contract are currently removing Ether from supply.
On the topic of altcoins, Powell pointed to the buzz surrounding Polkadot, alluding to perceptions the network may comprise “the next Ethereum” due to scaling and fee issues.
“There are a lot of other coins that are being launched on top of this network, and I think you’ll see a lot of things that were on Ethereum be ported over to Polkadot,” he said, noting the “lower transaction fees” associated with Polkadot.
Polkadot seeks to offer greater speed and efficiency than other crypto networks by processing transactions using a “parachain” architecture where multiple sharded chains operate in parallel. While parachains are yet to launch on Polkadot’s mainnet, the ecosystem's Acala Network, became the first project to secure a parachain slot on Polkadot’s Rococo testnet last week.
Although sharding is on the Eth2 roadmap, Ethereum co-founder Vitalik Buterin revealed earlier this month its developers are currently prioritizing the chain merge between Ethereum and Eth2. Buterin also expressed confidence that layer-two rollups will scale the network sufficiently over the short term while sharding is not a developmental priority. Optimism's rollups mainnet has since been delayed until July.