Bitcoin doesn’t qualify as a currency, PayPal CEO stated today in an interview with CNBC’s Squawk Box. Rather, it’s a reward mechanism for implementing blockchain, Dan Schulman believes. The sentiments are nothing new given PayPal top executives’ history with bitcoin. In the past, Schulman has torn into bitcoin, especially in its use as a transactional currency. He believes that retailers will never use bitcoin as its volatility could wipe out the profits these retailers make.
Meanwhile, a top crypto investor stated today that he believes bitcoin will go to zero. Despite his venture capital firm having invested in several blockchain startups, Jeff Schumacher is bearish on bitcoin’s future. Schumacher was speaking as part of a four-people panel at the World Economic Forum in Davos, Switzerland. Bitcoin has great technology underpinning it, but it’s simply not a currency, he stated.
Everyone’s Favorite Punching Bag
Bitcoin hasn’t been having a good run since Christmas. After hitting $4,250 on Christmas Eve, it’s lost over 15 percent and it currently trades at $3,571. In the past two weeks, it has ranged between $3,670 and $3,570. The market has been rather still, with many traders lying in wait to see what direction the currency takes next.
And despite several top executives recognizing Bitcoin’s promise, Schulman isn’t convinced. Schulman has extensive experience at top-level positions with Virgin Mobile, Sprint, American Express and Symantec. In an interview with CNBC, he stated:
I have always thought that crypto was more of a reward mechanism for implementing blockchain as opposed to really a currency. And we are not seeing many retailers at all accept any of the cryptocurrencies. But I think the underlying technology is still very interesting.
Bitcoin’s unsuitability to retail is a point Schulman has stuck with for quite long in his opposition to crypto. As we reported last year, he stated in an interview that the unpredictable and volatile nature of cryptos could spell losses for retailers. At the time, bitcoin was trading above $13,000. With the currency having lost close to $10,000 since then, his resolve has only become strengthened.
Going to Zero
While the PayPal CEO bashing crypto is quite expected – after all, the two are in direct competition – the latest bearish remarks are from the least expected source. Jeff Schumacher is the founder of BCG Digital Ventures, a VC firm that has invested in over fifty startups, some of them in blockchain. According to him, bitcoin is going to zero.
The former partner at McKinsey stated:
I do believe it will go to zero. I think it’s a great technology but I don’t believe it’s a currency. It’s not based on anything
The panel composed of key figures in the crypto industry, one of whom was Ripple CEO, Brad Garlinghouse. He was quick to state that while he agrees on the utility of a token determining its chances of success in the future, he wouldn’t predict the demise of bitcoin.
Glenn Hutchins, yet another panelist termed Schumacher’s prediction as ‘wrong-headed thinking.’ Hutchins is an experienced investor and the co-founder of $39 billion private equity firm Silver Lake Partners. He likened the current crypto winter to the period in the early 2000s when interest in the internet waned by over 90 percent. Many were sure that the end for the internet had arrived, but Hutchins was optimistic that it had a bit more to offer. He holds the same view for cryptos.