Billionaire tech investor who claimed Bitcoin would reach $200,000 now says “crypto is dead in America”
In November 2021, Bitcoin reached an all-time high of $68,789.63. At the time, tech investors including Billionaires Tim Draper and Chamath Palihapitiya predicted that Bitcoin would soar to over $200,000. Draper said he’s confident Bitcoin would reach $250,000 in 2023, despite the ongoing chaos in the crypto market. Palihapitiya also predicted the world’s most popular cryptocurrency would surge to $200,000.
Fast forward two years later, Palihapitiya is walking back on his prediction. In the latest episode of the All-In podcast, the billionaire venture capitalist told his listeners that “Crypto is dead in America.”
Palihapitiya blamed the downfall of crypto mostly on regulators, who have intensified their efforts to catch bad actors in the space. Gary Gensler, the chairman of the Securities and Exchange Commission (SEC), has called for crypto trading platforms to adhere to stringent US securities regulations.
In a recent testimony with lawmakers, Gensler linked the collapse of Silicon Valley Bank with the crypto industry.
“You had Gensler even blaming the banking crisis on crypto,” Palihapitiya said. “The United States authorities have firmly pointed their guns at crypto.” They “were probably the ones that were the most threatening to the establishment,” said Palihapitiya, referring to crypto companies. “And they were the ones that, in fairness to the regulators, did push the boundaries more than any other sector of the startup economy.”
“Now they’re paying the price for that,” he said. “The bill has come due for them.”
During a four-hour congressional testimony last week, House Republicans leveled comparable criticism at Gensler for the Securities and Exchange Commission’s clampdown on cryptocurrency platforms.
“Regulation by enforcement is not sufficient nor sustainable,” said House Financial Services Committee Chairman Rep. Patrick McHenry, R-N.C. “You’re punishing digital asset firms for allegedly not adhering to the law when they don’t know it will apply to them.”
McHenry said the SEC’s approach was “driving innovation overseas and endangering American competitiveness.” Gensler defended the agency’s actions saying, “We have a clear regulatory framework built up over 90 years,” he said, adding that the exchanges “are “noncompliant generally, and they need to come into compliance.”
Since its peak in November 2021, the crypto market has lost more than $2.1 trillion in market cap, resulting in significant losses for investors whose portfolios have decreased in value. This has led to some individual investors losing almost all of their savings.
Palihapitiya predicted in early 2021 on CNBC that Bitcoin would rise from $39,000 at the time to $100,000 and then up to $200,000.
“In what period, I don’t know,” he said. “Five years, 10 years, but it’s going there. And the reason is because every time you see all of this stuff happening, it just reminds you that, wow, our leaders are not as trustworthy and reliable as they used to be.”