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Billionaire venture capitalist and bitcoin investor Tim Draper stands by his prediction that bitcoin will hit $ 250,000 by the end of 2022 or early 2023 despite crazy swings in the value of the cryptocurrency and the commotion around its non-environmentally friendly energy consumption.
“I think I’m going to be right on this one,” Draper told CNBC Make It.
Draper first made the bold price prediction in 2018, when bitcoin was trading around $ 8,000, according to Coinbase.
“I’m going to be really right or really wrong [but] I’m pretty sure it goes in that direction, ”Draper said.
This is because Draper believes the currency will be “used a lot more by then.”
“Give it about a year and a half and the retailers will all be on Opennode [a bitcoin payment processor], so everyone will accept bitcoin, ”predicts Draper.
Currently, only a few large companies accept bitcoin directly or indirectly through a third-party digital wallet app, including Microsoft, PayPal, Overstock, Whole Foods, Starbucks, and Home Depot. And many experts view bitcoin as a store of value, like gold, rather than a currency.
“Then beyond that I think [bitcoin] continues to increase because there are only 21 million, ”says Draper. Under its code, only 21 million bitcoins can be “mined”.
Draper, 63, who built his fortune by making early investments in Twitter, Skype, Tesla and SpaceX (to name a few), wouldn’t say how many bitcoin he holds or whether he has invested in it. other cryptocurrencies.
“There must be something to dogecoin because it makes us all smile but no engineer works on it,” says Drapers. (However, Elon Musk tweeted in May that he was working with “Doge developers to improve system transaction efficiency. Potentially promising.”)
“I tend to focus on those where people dedicate their lives to improving the currency.”
Draper says most engineers are working on improving bitcoin right now. Last week, Bitcoin got its first upgrade in four years, called Taproot. Due to take effect in November, the change would mean greater confidentiality and efficiency of transactions. It also aims to unlock the potential of smart contracts on the Bitcoin blockchain, CNBC reported.
Bitcoin “is a bit like Microsoft [in] the software world or Amazon [in] the world of electronic commerce, ”said Draper. He believes bitcoin will be the center of all financial activity for the next two to three decades.
However, the value of bitcoin is volatile and there are concerns about its huge energy consumption. For this and other reasons, experts recommend investing only as much money in bitcoin as you can afford to lose.
Hundreds of billions of dollars were wiped from the cryptocurrency after Elon Musk tweeted in May that he was suspending bitcoin purchases at Tesla for environmental reasons.
On Sunday, Musk tweeted that Tesla will accept bitcoin again when at least half of it can be mined using clean energy.
“Elon, first of all, is one of the brightest men in the world … perhaps the brightest, [but] he was wrong on this one, ”says Draper. (A Tesla spokesperson did not immediately respond to CNBC’s Make It request for comment.)
Draper points out that the big banks have their own environmental problems.
Bitcoin rose more than 7%, hitting nearly $ 40,000 on Monday, according to Coinbase. In April, it hit an all-time high of $ 64,829 before hitting a low of $ 30,000 in May following a 30% intraday crash, according to CNBC.
This is not the first time Draper has predicted the rise in the price of bitcoin. In 2014, when bitcoin was trading at around $ 500, he said bitcoin would go above $ 10,000 within three years. In December 2017, bitcoin hit over $ 10,000, peaking at over $ 18,900 on December 19 before dropping back to a low of $ 7,270 in early 2018, according to Coindesk.
In 2014, Draper bought nearly 30,000 bitcoins seized by US Marshals Services on the now defunct Silk Road online black market.
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