Fred Ehrsam, co-founder of Coinbase, told CNBC on Wednesday that the cryptocurrency market has not yet reached its peak, even if trading in various digital currencies remains turbulent in the future.
Ehrsam’s comments on “Bell Closure” were published shortly after Coinbase was made public via a direct box office listing on the Nasdaq, a major milestone for cryptography on its path to institutional acceptance.
While they remain skeptical, Ehrsam said they have been continuously shown to be wrong since he became involved in Bitcoin two years after its creation in 2009.
“As someone who has been working in cryptography for ten years, I’ve heard this statement hundreds, if not thousands of times,” Ehrsam said when CNBC’s Sara Eisen asked him if the current hype surrounding the cryptographic market could indicate. ” that’s the top. “
Ehrsam co-founded Coinbase in 2012, when Bitcoin was around $ 6, and is still a member of the company’s board of directors. Co-founder Brian Armstrong is the CEO of Coinbase, the largest cryptocurrency exchange in the United States
“I think it’s going to be unstable from here on out, but that’s just the nature of such a huge technology that exists and I don’t think it can happen any other way,” said Ehrsam, managing partner of the investment firm cryptographic Paradigm.
Bitcoin has been in tears since last year. As recently as October, bitcoin was trading below $ 11,000 per piece. It hit a record high of more than $ 64,000 Wednesday before, although it withdrew from those levels and traded at around $ 62,000 around 4:45 p.m.
A number of large institutions, including major Wall Street banks, have announced their entry into cryptography in recent months. It has been cited as one of the factors driving the rise of bitcoin.
The sustainability of the cryptographic rally has been questioned.
For example, the latest Bank of America fund manager survey found that approximately 74% of respondents believe Bitcoin is in a bubble. And on Wednesday, Federal Reserve Chairman Jerome Powell said he believed cryptocurrencies were “really vehicles of speculation,” adding, “They’re not really being actively used as payments.”
There has also been a meteoric rise in non-expendable tokens, or NFTs, in recent months. Ownership of these digital assets is recorded in a blockchain, the decentralized records that underpin cryptocurrencies like bitcoin. Some have also questioned NFTs, suggesting that they are also in a bubble and will eventually lose their value.
“This is the fourth cycle of cryptography. It started in 2011, when I came from my New York apartment working for Goldman,” said Ehrsam, a former bank trader. “[Bitcoin] it has gone from $ 32 to $ 2 … over the course of three hours. “
Other major cycles occurred in 2013 and 2017, he said, “and now it’s happening again.”
“I think the reality is that if cryptography wants to achieve the huge mission that I think it can be (which is to be a new global platform for digital money, financial systems and Internet applications), there will be a lot of volatility along the way, “Ehrsam said. “It’s certainly not for the faint of heart in the early days, and that was a huge challenge when it came to building Coinbase and staying the course.”
Coinbase closed its first trading session on the Nasdaq at $ 328.28 per share, placing the market capitalization of the cryptocurrency exchange at $ 85.8 billion in full dilution.