The CEO of crypto exchange Kraken said he stands by his prediction that one Bitcoin will be worth as much as one of the most expensive cars on the market by the end of the year, but with the price of the No. 1 digital coin fluctuating as much as 50 percent in a day, he said, “don’t gamble your rent” on it.
Jesse Powell is the co-founder and CEO of Silicon Valley-based Kraken, the No. 4 crypto exchange in the world by volume, according to Coinmarketcap. Kraken did $1.4 billion in volume in the past 24 hours, compared to No. 1 crypto exchange Binance ($24 billion).
“Probably by the end of the year, I think it will be one Bitcoin per Lamborghini and probably by the end of next year, it will be one Bitcoin per Bugatti…” Powell said in a March 30 interview with Bloomberg TV. A Bitcoin was worth about $59,000 at the time. Since then, the price has nosedived almost 50 percent and was trading at $36,697 as of this writing.
Powell revisited the Bitcoin-worth-a-Lambo claim with Bloomberg’s Emily Chang on June 3. He said he still stands by it.
“You can buy a forward delivery of a Lambo now at a discount at a cheap $37,000,” Powell said. “Lots of people are buying the dip. Personally, I’m googling like how to sell my kidneys at this point … But look, like I think people are getting ready to go on to ramen diets to buy Bitcoin at these levels.”
As for Bitcoin’s lower prices, he’s “not worried about this little dip,” Powell said. “We’ve seen this over and over — crypto is a roller coaster. You got to be able to have an iron stomach to tolerate the ride. But the gains are massive for those who can handle it.”
Chang responded, “I thought people were only supposed to invest what they could really afford to lose.”
“Don’t gamble your rent on bitcoin,” Powell said. “You’ve really got to be able to think about this investment and hold for 5 to 10 years. Don’t think about this as a week-to-week swing trade. People absolutely should not be betting any more than they can afford to lose. It’s still a very risky investment. But obviously, over time, if you look at the chart, you know, 10 years ago, Bitcoin was trading at $1. Today, $36,000. Still year over year, it’s up 200 plus. So long term, it’s an absolutely fantastic investment. From my point of view, I absolutely would not put 100% percent of my portfolio into Bitcoin. I would not pay my rent money into Bitcoin.”
Powell talked about the excitement Bitcoin is generating in places like Miami, where the recent Bitcoin 2021 conference was held with appearances or speeches by pro boxer Floyd Mayweather, Twitter CEO Jack Dorsey and Michael Saylor, CEO of MicroStrategy, the largest publicly traded corporate holder of Bitcoin.
“Take all your money and buy Bitcoin,” Saylor has advised investors. “Then take all your time to figure out how to borrow more money and buy more Bitcoin. Then take your time to figure out what you can sell to buy more Bitcoin.” Then Saylor added that investors should mortgage their houses and businesses to buy Bitcoin.
Miami Mayor Francis Suarez has been working to make the city a tech and crypto hub. Luxembourg-based crypto exchange Blockchain.com is the latest tech company to move its headquarters to South Florida. Suarez made the announcement at a news conference ahead of the 2021 Bitcoin Conference, NBCMiami reported.
Listen to GHOGH with Jamarlin Martin | Episode 74: Jamarlin Martin Jamarlin returns for a new season of the GHOGH podcast to discuss Bitcoin, bubbles, and Biden. He talks about the risk factors for Bitcoin as an investment asset including origin risk, speculative market structure, regulatory, and environment. Are broader financial markets in a massive speculative bubble?
“Everything that’s happening in Miami right now, the excitement around the space is so hot. I think people just see this growing massively,” Powell said.
A June 2 Miami Herald editorial offered a counter perspective to Powell’s Bitcoin buoyancy, warning of the downside of boom times as the city embraces all things crypto.
“Don’t get us wrong. We hope cryptocurrency — and the flashing neon welcome mat we’ve set out for the tech industry — elevate this city to new prosperity,” the editorial said. “Just don’t blame us for being a bit wary. Because Miami has history, folks. We’ve been a smugglers’ paradise, the epicenter of the cocaine trade, a mecca for money laundering, ground zero for mortgage fraud … We worry about going through another boom-and-bust cycle or a wave that crashes and takes us all down with it.”
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