This top bitcoin booster thinks the cryptocurrency will hit $40,000 a coin this year - but believes 90% of other ones will fail
- Llew Claasen, the executive director of the Bitcoin Foundation, predicted its namesake cryptocurrency will hit $40,000 a coin by the end of the year, but only after more sideways trading.
- Claasen also predicted that 90% of all other cryptocurrency projects will fail.
- But that failure is OK, he says, because it indicates that people are experimenting and taking risks with cryptocurrencies.
REDWOOD CITY, CALIFORNIA - If you're a bitcoin believer, the head of a key advocacy group for the cryptocurrency had some words on Wednesday to either strengthen or weaken your faith, depending on which part of his remarks you focused on.
On the optimistic side, Llew Claasen, the executive director of the Bitcoin Foundation, predicted its namesake cryptocurrency will hit $40,000 a coin by the end of the year (it's currently trading above $9,000). On the other hand, Claasen predicted that 90% of all cryptocurrency projects overall will fail.
But even that isn't all that bad, he said.
That kind of failure rate "is not unusual to cyptocurrency," Claasen said in an appearance at the Startup Grind conference. He added that it's an indication that the projects are trying "something new and exciting and super-risky."
Of course, to some degree, the failure rate might also be linked to a growing number of get-rich-quick schemes formulated by scam artists looking to cash in on the cryptocurrency craze. Already this year, some five different cryptocurrency projects have shut down amid accusations of fraud.
Claasen did express some concern about everyday investors "risking life savings on projects that are high risk," and cautioned investors to not invest more in these coins than they can risk losing. But in an interview with Business Insider after his talk, he said he thought the market would sort through such scams and prevent them in the future. Already, investors were learning to avoid such dodgy investments, he said.
"In this case, I do believe this is a problem the market is good at solving," he said.
Claasen is only the latest to predict a high failure rate for cryptocurrency projects. On Tuesday, Brad Garlinghouse, the CEO of crypto company Ripple, predicted that most digital currencies will eventually become worthless.
Claasen's talk was on what investors should know before investing in bitcoin. He gave his prediction for the currency's eventual value at the end of his session.
He made clear that he didn't think bitcoin would make a steady climb to $40,000 a coin. Instead, he predicted that the volatility the cryptocurrency has seen in the last three months - during which time it hit an all-time high of around $20,000 a coin before losing more than half of its value - would continue for the next three to six months. During that period, bitcoin prices will likely stay flat, he said.
"The market is nervous because of how dramatic the correction was," he said. "That's good. It gives us time to work on the technology before the next bull run."