Bitcoin investor Tim Draper believes the cryptocurrency is primed for an epic turnaround. His billionaire status depends on it.
Roger Kisby/redux
Venture capitalist Tim Draper thinks cryptocurrency is going to go up more than 10-fold by the end of 2023. He isn’t the only crypto mogul whistling in the dark.
During an interview with Forbes in January this year, the venture capitalist Tim Draper offered an ambitious prediction: Bitcoin would hit a whopping $250,000 within a year. At the time, Bitcoin was worth about $41,000.
“This is the year it’s gonna happen,” insisted Draper, who paid $18.7 million at a U.S. Marshals Service auction in 2014 for his stash of around 30,000 bitcoins (yes, that’s $623 per Bitcoin). “By the end of this year—or early next year.”
Suffice it to say that Draper’s prediction isn’t panning out. Bitcoin has lost more than half of its value since the start of the year, plunging from $47,000 on New Year’s day to around $20,000. He is one of four crypto moguls who are no longer billionaires thanks to the digital currency crash. But Draper isn’t backing off. Reached over email, Draper reiterated his price target. “I am more convinced than ever that it is happening,” he said. “By late 2022 or early 2023.”
Easy Come, Easy Go
Since early March, these eleven people have lost the most money in crypto. Only seven are still billionaires and they have lost an aggregate of $61 billion over the last three months.
Fred Ehrsam, cofounder and former president of crypto exchange Coinbase, insists the market meltdown is nothing more than growing pains. “One thing most people don’t fully grasp: it takes years, often decades, to go from a new infrastructure-level technology breakthrough (like crypto) to a vibrant ecosystem of mainstream applications,” tweeted Ehrsam earlier this week. The 34-year-old computer whiz is now worth an estimated $900 million, down from $2.1 billion in March.
One reason Ehrsam may have a cool head: His fortune includes around $367 million in post-tax cash proceeds from sales of Coinbase stock, which he unloaded last year at an average price of $316 a share (Coinbase is currently trading at about $52 per share). Ehrsam seems to see the market collapse as a buying opportunity: He bought $77 million of Coinbase stock on behalf of his crypto venture capital and investment firm, Paradigm Capital, in May, for between $60 and $73 per share.
Cameron and Tyler Winklevoss, the Bitcoin investors, twin brothers and founders of crypto trading firm Gemini, have also seen their fortunes fall, from an estimated $4 billion in March to $3.2 billion now. They laid off 10% of Gemini’s staff on June 2, citing the “crypto winter.” But they haven’t let the market implosion cramp their style. Their throwback rock band, Mars Junction, is currently on tour in California and in early June, the twins were videotaped at a bar in Asbury Park, New Jersey singing Journey’s Don’t Stop Believin’ about a week after they’d announced Gemini’s layoffs. As of press time, tickets for Mars Junction’s show in Berkeley tonight are $15 each.
While the Winklevoss twins are playing rock star, Sam Bankman-Fried, the richest person in crypto, is going for a different role: Industry Savior. Earlier this week, the mop-headed 30-year-old founder of trading juggernaut FTX extended huge loans to embattled crypto companies: $250 million to crypto lender BlockFi and nearly $500 million (including $300 million in Bitcoin, of course) to brokerage Voyager Digital. “We take our duty seriously to protect the digital asset ecosystem and its customers,” he tweeted. Bankman-Fried’s estimated fortune has only dipped a few billion dollars since March, from $24 billion to $20 billion, mostly thanks to FTX’s $32 billion valuation from its last funding round in January.
Meanwhile, crypto’s former richest person Changpeng Zhao (or “CZ”), founder and CEO of Binance, the world’s largest crypto exchange, is in a tongue-in-cheek mood. “I am most bullish in bear markets ?,” he tweeted on Thursday, which was followed immediately by a second post: “Not financial advice.” That may have been a joke, but CZ has good reason to offer such disclosures: The S.E.C. has opened a probe into Binance’s initial coin offering, Bloomberg reported earlier this month. CZ’s company is also under investigation by the U.S. Justice Department, the Commodity Futures Trading Commission and the Internal Revenue Service (Neither Binance nor CZ has been charged by any U.S. authorities).
The Winklevoss twins are some of Bitcoin’s largest investors.
Michael prince for forbes
Among crypto’s billionaires, Zhao is the biggest loser, in percentage and dollar terms, since March 11. Then, CZ’s estimated fortune of $65 billion made him the 19th richest person in the world. Today, he is worth an estimated $18.7 billion. Not that he cares in the slightest. “I don’t really know what my net worth is. I’m not too bothered about it,” he told Forbes last summer.
Michael Saylor, a true Bitcoin believer whose software company Microstrategy has spent about $4 billion on Bitcoin investments in the last few years, has taken a different approach: going on the offensive. The 57-year-old software entrepreneur has been bombarding Twitter with bullish posts, and made recent television appearances on CNN, Fox Business and Bloomberg, where he shrugged off concerns about his company’s balance sheet. In March, MicroStrategy borrowed $205 million against its own Bitcoin, to buy – you guessed it – more Bitcoin.
Saylor is now another ex-billionaire, Forbes estimates, worth a little over $700 million. MicroStrategy’s stock is down 56% since early March, compared to the Nasdaq index’s 14% dip over the same period. But Saylor hasn’t sold any of his precious Bitcoin—“not a satoshi”, he told CNN anchor Julia Chatterley this week, invoking a little-known term for Bitcoin’s smallest unit. (One satoshi is worth 0.00000001 BTC.)
“Bitcoin is going to outlast all of us,” Saylor insisted. “I’m quite sure of that.”
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Source: https://www.forbes.com/sites/johnhyatt/2022/06/24/former-crypto-billionaire-insists-bitcoin-will-soar-to-250000-within-next-18-months/