Goldbug Peter Schiff boasts that he has cracked the case of the plunging Bitcoin price. No, it wasn't the US government's sudden crypto scrutiny that triggered the decline - it was Peter Schiff himself!
Schiff, the CEO of investment firm Euro Pacific Capital, advised a YouTube audience on Monday to buy silver and sell Bitcoin. Subsequently, the Bitcoin price went down as silver appreciated. That, he claims, is no coincidence.
On my Bitcoin challenge Live Stream on Youtube Monday I recommended selling Bitcoin and buying silver. Since then the price of Bitcoin has fallen by over 10% (even after a 10% rally from the low), and silver is up 3.8%, its biggest two-day gain in two years. Coincidence?
— Peter Schiff (@PeterSchiff) July 17, 2019
A closer look at the charts, however, suggests that Schiff might be full of hot air.
While there are individuals who can certainly move markets simply by the power of their words (think the Federal Reserve Chairman), this was clearly not the case since the prices of the two assets were already trending in the respective directions.
Schiff’s YouTube Bitcoin challenge was held on Monday at 9 pm ET, by which time the cryptocurrency had already fallen below the key $10,000 psychological level.
Silver, on the other hand, had been on an uptrend since May. On the day of the Bitcoin challenge, silver had experienced a slight correction before resuming its upward move.
Schiff remains defiant, will not welcome crypto into his heart
During the YouTube stream where the Bitcoin skeptic had invited the crypto community to turn him, Schiff came away largely unconvinced about the potential of cryptocurrencies.
For instance, he argued that Bitcoin’s short lifespan does not give it a chance to trade places with gold as a store of value, and he would not invest his hard-earned money in the digital asset.
Contrasting it with the yellow metal which has been in use for thousands of years, Schiff said that he owns "a pair of socks that I have had for more than ten years," a clear jab at Bitcoin.
Schiff: Bitcoin price only goes up when there's a greater fool
Schiff also argued that demand for Bitcoin was being generated by the irrational expectations of market participants who are only purchasing it because they expect to sell it to someone else at a later date at a higher price.
Additionally, the goldbug expressed his frustrations at Bitcoin maximalists. He ranted that just because BTC is the first cryptocurrency does not guarantee it a future.
Instead, he insisted that anything manmade can always be improved upon, noting that technological innovation always ensures that all first-generation products get antiquated within a matter of time.
"How many times has the very first invention of something been the best? Zero!"
Goldbug hedges his bet
In the same video, Schiff continued to predict that Bitcoin will "implode." But even if it succeeds, Schiff argued, it will become a victim of its own success:
"I don’t believe that Bitcoin is actually a threat to the monetary system that we have now… I don’t think it’s a threat to the fiat monetary system ‘cause it’s going to implode on its own. But if I am wrong, if it doesn’t die on its own, the government will kill it because if the government actually thinks it’s a threat they are going to act to protect their monopoly on money."