Peter Schiff, a well-known economist and renowned author, has taken another stab at Bitcoin. As he commonly compares the digital asset with gold, outlining its lack of intrinsic value, the expert now says that the precious metal will outperform Bitcoin as the latter will simply crash.
Bitcoin is commonly compared to gold in its property to serve as a store of value. In fact, the Chairman of the US Federal Reserve, Jerome Powell, referred to it as a “speculative store of value, just like gold.”
This doesn’t seem to be the opinion of Peter Schiff, though, as he’s been known for refuting Bitcoin’s value.
He reiterated his views today, once again saying that Bitcoin will ultimately “crash back to earth.”
Over the past several years Bitcoin hodlers poked fun at gold investors because #Bitcoin gained so much more than #gold. Over the next several years those roles will reverse, but not because gold rises more than Bitcoin, but because gold moons as Bitcoin crashes back to earth.
— Peter Schiff (@PeterSchiff) April 11, 2020
Being asked to short Bitcoin as means of putting “his money where his mouth is,” Schiff explained that he’s already betting against the popular cryptocurrency.
“I own no Bitcoin and am long lots of gold and silver, and even larger positions in precious metals mining stocks. That’s effectively a big bet against Bitcoin becoming the new gold, or taking a safe have/store of value market share away from gold.” – He said.
Having many qualities relative to gold, Bitcoin is also commonly referred to as “digital gold.” Indeed, the cryptocurrency is “mined” in a sense that it takes work to produce more of it, hence the Proof-of-Work (PoW) consensus algorithm.
Furthermore, Bitcoin is also scarce – just as gold. Both assets have a predetermined amount. There’s only so much gold in the earth and so many bitcoins that will be minted. The difference is that we know how many bitcoins there will be (21 million), but not how much gold is left unmined.
Yet, an interesting point was brought up in Schiff’s Twitter thread, outlining that gold is archaic, and it used to work for non-digital societies, which ours is not. To that point, Schiff argued that “gold only became money about 700 BC. So it’s actually pretty modern. Plus, it’s a metal, not a rock. Bitcoin will never be money. Not even cavemen would be dumb enough to accept it.”