CNN exclusive interview with Vitalik Buterin: Ethereum may eventually surpass Bitcoin in market value

This article was published on BitpushNews, author: Matt Egan; translation: Chen Zou.

Ethereum co-founder Vitalik Buterin, affectionately known as "V God" in the crypto community, recently gave an interview to CNN Business where he expressed his belief that the crypto market is in a bubble. However, he emphasized that "it is well known that it is difficult to predict when a bubble will burst." The crypto frenzy may have ended, or it may not end for several months… "Elon (Musk) won't have this kind of influence forever."

On Wednesday morning, according to Coinbase data, Ethereum fell below $1,900, a staggering drop of over 40% compared to Tuesday night. By Thursday morning, Ethereum rebounded to around $2,700, but there is still a significant gap compared to its all-time high of $4,384 set on May 11.

Buterin was born in Russia and started programming at the age of 4; at 6, he immigrated to Canada with his family and holds dual citizenship in Russia and Canada; at 7, he created complex documentation for "Rabbit Encyclopedia"; by 10, he could perform mental arithmetic at double the speed of his peers; at 12, he was already writing simple games in C++; dropped out of college at 19; and became a co-founder of Ethereum at 20.

At just 27 years old, Vitalik Buterin is already accustomed to the cyclical nature of cryptocurrency bull and bear markets. In his eyes, the crypto market is not just a game of money.

Cryptocurrency is no longer just a toy

Buterin said, "So far, we have at least had three major cryptocurrency bubble periods, and often the reason the bubble eventually stops is that something happens that suddenly makes people realize the technology is not yet at the level they imagined."

Buterin articulated his vision for Ethereum in a white paper in 2013, and Ethereum was officially launched two years later. Today, it is the second-largest cryptocurrency, after Bitcoin. Unlike Bitcoin, which is seen as "digital gold," Ethereum is a blockchain-based platform for developers to build and operate applications. It is like Android or iOS in the cryptocurrency space.

At the end of 2017, Buterin sparked a Twitter storm questioning whether the cryptocurrency space truly deserved its market valuation, which had just surpassed $5 trillion. He pointed out that actual achievements were minimal, and cryptocurrency prices quickly fell thereafter.

Unlike then, Buterin is encouraged by the "huge" progress in technology and applications in recent years. For example, due to the rise of NFTs on social media and several iconic breakout events, Ethereum's activity has surged sharply in recent months, as NFTs are based on the Ethereum network.

Buterin said, "It feels like cryptocurrency is ready to integrate into the mainstream, whereas four years ago, it was the complete opposite; it was not ready at all. Cryptocurrency is no longer just a toy. While I'm not sure, Ethereum still has the potential to eventually catch up to and surpass Bitcoin in market value."

Vitalik Buterin - Caricature | Vitalik Buterin co-founder of… | Flickr

Dog-loving loudmouth BOSS Musk

However, Ethereum and the broader cryptocurrency market still have issues. Firstly, they remain highly volatile, especially for retail investors accustomed to more moderate fluctuations in the stock market.

Moreover, some billionaires seem to treat cryptocurrencies as toys. Elon Musk's fluctuating affection for various coins has sent shockwaves through the entire field.

When Musk tweeted on May 12 that Tesla would stop accepting Bitcoin payments due to concerns about the negative environmental impact of cryptocurrency (because Bitcoin's complex mining process requires a massive amount of computing power and electricity), market sentiment in the crypto space immediately shifted. According to CNBC, nearly $365 billion in cryptocurrency market value evaporated that day.

Buterin acknowledged that the cryptocurrency market often appears "very fragile" in the face of destructive events before it "builds its own immune system over time."

Musk's tweets affecting the market is a relatively new phenomenon in the cryptocurrency space. Buterin believes it's reasonable for things to be a bit crazy right now. However, the market will ultimately progress. Elon won't have this kind of influence forever.

The Tesla billionaire has also repeatedly promoted Dogecoin, a meme coin created as a parody of the crypto market. Musk mentioned Dogecoin again during a Saturday Night Live performance.

Buterin believes Musk's obsession with Dogecoin is merely out of interest and not malicious.

He said, "He (Musk) is a billionaire with over a hundred billion, running Tesla and SpaceX and all these things, but that doesn't change the fact that he is ultimately just a person, and humans get excited about Dogecoin. It's just a human instinct. I don't think Elon has any malice in these matters."

Le Dogecoin (DOGE) est la crypto préférée d'Elon Musk - crypto-sous.fr

V God slashes SHIB

Recently, another animal coin that has excited people is Shiba Inu, a meme coin that claims to be the "Dogecoin killer."

After Buterin donated $1 billion worth of SHIB to India's Covid-19 relief fund, Shiba instantly plummeted by about one-third. This sell-off highlighted some liquidity issues with these altcoins. He said, "The problem with these Dogecoins is that their market is too small; in reality, selling what was originally worth $1 billion in Shiba Inu might not even yield a few million dollars."

Buterin recently announced plans to burn or remove 90% of the SHIB he holds from circulation, all of which came from on-chain donations. Buterin stated that he does not want to become a "center of power." In the interview, he emphasized that he does not want creators of altcoins to send him coins for "marketing" purposes.

Buterin mentioned, "First of all, I don't really understand or comprehend these projects. So, I can't endorse them. I see that I have thousands of altcoins called Freecoin in my wallet. I don't even know what that thing is."

Buterin advised those who want to do good with crypto tokens to donate directly to charities.

Vitalik Buterin Has Burned His Remaining Shib Tokens

Government regulatory risks always exist

Part of the recent cryptocurrency crash is due to concerns about domestic regulation. Three regulatory agencies in China's financial and banking sectors stated on Tuesday that financial institutions and payment companies should not engage in any transactions related to cryptocurrencies, nor should they provide services related to cryptocurrencies to clients.

Buterin acknowledged in an interview with Chinese news that regulation "has always been an issue," although concerns about a complete ban have subsided. "Doing such things seems harder and more unrealistic. At the same time, the government does have significant power to make working in the cryptocurrency space more difficult." Even though blockchain is decentralized and the government cannot completely take it over, it can prevent or restrict access.

"It is important to listen to regulators so that we can do our best to address potential issues," he said, noting that "regulatory" risks have made the relationship between cryptocurrencies and regulators "more adversarial."

Gavel et crypto-monnaie. Concept de réglementation gouvernementale . --- Impôts, justice - Stock Photo | #198330838

PoS revolution will significantly reduce gas fees

Billionaire Mark Cuban complained to The Defiant in February that Ethereum's development is constrained by "ridiculous" transaction fees. V God mentioned, "Transaction fees are indeed 'very high' right now, despite the high demand for transactions, the Ethereum blockchain can only handle 20 to 50 transactions per second."

But V God remains confident, firmly believing that transaction costs will decrease as the Ethereum team is undergoing a massive technical overhaul aimed at enabling Ethereum to scale rapidly. Ethereum is transitioning from the original blockchain technology algorithm "Proof of Work" to a newer concept called "Proof of Stake." In short, this upgrade means that participants in the Ethereum network will receive appropriate rewards for staying online and maintaining the network's normal operation. This will eliminate the energy consumption competition brought about by Proof of Work.

Investigating Recent Spikes in ETH Gas Fees | by GAINS Associates | GAINS Associates | Medium

Environmental issues loom

Buterin stated that transitioning to Proof of Stake will reduce Ethereum's energy consumption by 1,000 to 10,000 times.

He said, "This will also effectively control the energy consumption of the Ethereum network, reducing it from the level of a medium-sized country to that of a village."

In stark contrast to Ethereum's improvement direction, Buterin expressed concerns that the environmental impact of Bitcoin may become a reality in the future. He said, "I absolutely believe these concerns are real; resources are indeed being consumed in large amounts. It's not the kind of problem that can destroy the world, but it is definitely a significant drawback." Buterin added that this is not only reflected in the electricity consumption of Bitcoin miners but also in the hardware required for mining.

This is why V God has consistently emphasized that as Bitcoin develops and adapts to technological advancements, there will be more voices within the Bitcoin community calling for either a transition to Proof of Stake or a hybrid model.

He said, "If Bitcoin sticks to its original technology without making any changes, it is likely to be left behind forever."

What Is the Environmental Impact of Bitcoin?