Peter Schiff Doesn’t ‘Hate Bitcoin’ But Warns ‘Millions’ Will Lose More Than They Can Afford In ‘Speculative Mania’
Economist and market commentator Peter Schiff has issued a stark warning about the current speculative frenzy surrounding Bitcoin (CRYPTO: BTC), asserting that millions of investors will lose sums far greater than they can afford.
What Happened: Schiff sought to highlight his concern about the misallocation of capital, and how the speculative mania around cryptocurrencies will damage the image of sound money principles.
In a tweet on Wednesday, Schiff stated that he does not “hate Bitcoin itself,” but is deeply concerned by “the speculative mania in Bitcoin that has caused a huge misallocation of capital.”
He believes this frenzy will ultimately lead to “millions” losing “sums far greater than they can afford,” and will “tarnish the image of sound money and libertarian principles.”
Schiff’s remarks came in response to a question about his seemingly negative view of Bitcoin.
In an earlier tweet, Schiff predicted that when it becomes apparent that the U.S. government is not going to buy Bitcoin, investors who purchased it with this expectation will quickly sell, potentially triggering a sharp drop.
He believes MicroStrategy (NASDAQ:MSTR) CEO Michael Saylor, will be forced to accelerate his leveraged Bitcoin buying in an attempt to “prevent a crash.”
However, Schiff argues that this approach will ultimately only delay the crash and will “cause MSTR to crash first.”
Also Read: CFTC Chairman Rostin Behnam To Step Down In February
Why It Matters: Schiff’s comments are driven by his long-standing belief that Bitcoin is not a legitimate store of value, and the current market is driven by irrational exuberance and misguided speculation.
Schiff sees gold as a haven in times of economic and geopolitical instability, emphasizing its intrinsic value and historical resilience.
In December, Schiff disagreed with Michael Saylor’s analogy comparing Bitcoin to real estate, stating the latter generates rents, but Bitcoin doesn’t generate any income to make interest or principal payments.
The Bitcoin critic also mulled the hypothetical introduction of a new government-backed cryptocurrency with a supply limit of 21 million.
A meme coin subsequently spawned was disavowed by Schiff, who commented that his post was “sarcastic.”
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