The DOJ investigation has contributed to gold’s record levels, says Peter Schiff. What impact will it have on Bitcoin?
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Key Takeaways
Federal Reserve Chair Jerome Powell revealed the Justice Department had issued grand jury subpoenas.
Peter Schiff attributed the recent surge in gold to safe-haven demand triggered by the investigation.
The move has raised questions over the future impact on Bitcoin’s price, as analysts warn of bearish indicators.
Gold climbed to record levels after Federal Reserve Chair Jerome Powell disclosed that the Justice Department had issued grand jury subpoenas to the central bank.
Longtime gold advocate Peter Schiff said the investigation was driving safe-haven demand, raising questions about what impact the move could have on Bitcoin (BTC).
However, analysts warn that Bitcoin’s technical signals point to potential short-term volatility, leaving its near-term trajectory uncertain.
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In a statement, Powell said the subpoenas were part of what he described as a broader effort to influence the Fed’s decisions on interest rates.
He emphasized that the matter was not about congressional oversight or transparency around the Fed’s renovation projects, which had been publicly disclosed.
“The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President.”
Powell framed the dispute as a test of central bank independence.
“This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions—or whether instead monetary policy will be directed by political pressure or intimidation,” he said.
The Fed chair added that he would continue his duties, noting he had served under four administrations, Republican and Democrat alike, without political fear or favor.
Schiff Links Gold Rally to Fed Chair Investigation
Gold’s price hit an all time high on Sunday, Jan. 11, soaring past $4,600 per ounce.
Commenting on Powell’s statement, Schiff said the DOJ investigation had contributed to gold’s record levels.
“I am not a fan of Powell, but I agree with him on Trump’s motivation,” Schiff wrote on X. “This is part of the reason gold is soaring to record highs this evening.”
Schiff, who has criticized Trump’s policies in the past, previously claimed that the President’s next Fed Chair pick would be a “loyal soldier.”
The gold advocate argued that both Powell and Trump were wrong on interest rates, which he described as too low to support long-term economic growth.
I am not a fan of Powell, but I agree with him on Trump’s motivation. This is part of the reason gold is soaring to record highs this evening. In truth, Powell and Trump are wrong: monetary policy is too loose, and interest rates are too low. https://t.co/emrcNakmEE
“In truth, Powell and Trump are wrong: monetary policy is too loose, and interest rates are too low,” he wrote.
Responding to another X user, Schiff said higher interest rates were needed to “encourage savings,” which he believes “finances real investment.”
“Artificially low rates just cause inflation and finance speculation,” he added.
Schiff has long promoted gold as a hedge against inflation and currency debasement, while remaining a vocal critic of Bitcoin, which he has previously called a “Ponzi scheme.”
Peter Schiff vs Bitcoin
Schiff has long publicly criticized Bitcoin, calling the cryptocurrency a “Ponzi scheme.”
He previously said his initial mistake was misjudging market psychology rather than the underlying technology.
“The biggest mistake I made with Bitcoin when I first learned about it was overestimating the ability of others to understand why it wouldn’t work,” he said.
“The very people foolish enough to buy it thinking it would work will be foolish enough not to sell it as the market proves me right,” he added.
Peter Schiff is a long-time hater of Bitcoin | Source: X
The comments coincided with Schiff’s social media posts claiming that Bitcoin had “no future.”
“It’s not a good medium of exchange for payments,” he said.
“If you also want a store of value, tokenized gold wins hands down. The race to get out of Bitcoin is on. Don’t be last,” he added.
Bitcoin Faces Technical Uncertainty
For Bitcoin, the political standoff has introduced uncertainty rather than a clear bullish catalyst, according to Victor Olanrewaju, an analyst at CCN.
“For Bitcoin’s price, this position introduces uncertainty, especially since the asset remains 27.15% below its all-time high,” Olanrewaju said in a recent report.
At the time of writing, Bitcoin was trading near $90,166, consolidating after recent declines.
“The daily chart indicates a bear flag is forming,” he said. “A bear flag is a short consolidation that forms after a sharp decline. It often acts as a pause before the prior downtrend resumes.”
BTC/USD Daily Chart | Credit: TradingView.
Olanrewaju said if the pattern confirms, Bitcoin could see renewed selling pressure.
“Should that happen, Bitcoin’s price could face another leg lower, especially if it breaks below the flag’s support with weak buying pressure,” he said.
However, momentum indicators suggest the decline may not yet be decisive, and renewed buying pressure could push Bitcoin above $98,119 resistance.
Still, he warned that hurdles remain.
“The red line of the Supertrend remains above the price. Should bulls fail to neutralize this, Bitcoin’s price risks a deeper drop to $80,633,” Olanrewaju said.
Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
