“Elon Musk will not affect crypto prices forever”
In a video interview with CNN, Ethereum inventor Vitalik Buterin commented on the latest crypto crash. He doesn’t see a crisis in it.
For Ethereum co-founder Vitalik Buterin, the recent price crash is little more than a lesson the crypto markets will learn. After all, the challenges that cryptocurrencies are now facing are not insurmountable.
The crypto crash of the past few days has shocked investors around the world.
Vitalik Buterin isn’t among them – even though the meltdown wiped out a huge chunk of his personal wealth. https://t.co/TkPlysfuNo pic.twitter.com/yuxxsPrsLB
– CNN (@CNN) May 20, 2021
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Elon Musk’s influence will wear off
First of all, Buterin advises a certain level of calm when it comes to crypto influencer Elon Musk. You have to understand that the person Musk is causing a significant stir. After all, he is not used to such a doctorate.
After all, Musk has only been tweeting intensively on the crypto topic for a little more than a year. A certain unrest is to be expected there.
Once market participants got used to attempts at influence like Musk’s, they would have less of an impact.
“Elon won’t have that influence forever,” Buterin told CNN. Although crypto prices are inherently susceptible to “disruptions”, a kind of immune system will develop against them over time.
Incidentally, he does not assume that Musk’s statements are motivated by any form of malice. Aside from all his billions, Musk is above all human. And people get upset about “dog coins”, says Buterin.
Fear of regulators is relatively unfounded
Buterin is relatively unafraid of regulatory restrictions. Of course you have to listen to the regulatory authorities and always try to dispel their concerns in a meaningful way.
However, he cannot imagine a concerted action by governments to ban cryptocurrencies. After all, it is very difficult to really prevent crypto down to the protocol level.
At best, governments could use their power to “inflict pain on the crypto market.” In the process, arguments could “become more confrontational than they should be.”
Change to PoS required
Buterin sees another challenge in the consensus method Proof-of-Work (PoW), which both Bitcoin and Ethereum are currently using. While Ethereum wants to switch to the more energy-efficient proof-of-stake (PoS) with version 2.0, there have been no such efforts with Bitcoin so far.
Buterin sees this as a danger for the top dogs in the crypto world. After all, a reduction “from the energy consumption of a medium-sized country to the energy consumption of a village” could already be achieved with his Ethereum network.
The resource consumption of the PoW is “definitely huge”. Buterin warns that if Bitcoin did not switch to a different consensus method, BTC could be overtaken by other protocols.
