news.bitcoin.com
Gold advocate and vocal bitcoin critic Peter Schiff has warned of a bubble in bitcoin exchange-traded funds (ETFs) that will burst when gold rallies. Schiff argues that gold will “inevitably” break out, and the price of bitcoin will crash as investors withdraw from bitcoin ETFs. “Bitcoin has basically become a bet against gold,” he stressed.
‘A Gold Rally Should Prick the Bubble’
Economist and gold advocate Peter Schiff has offered his perspective on the recent rise in bitcoin and spot bitcoin exchange-traded funds (ETFs) while outlining potential risks.
Schiff pointed out on social media platform X Wednesday that since Feb. 2, the Vaneck Vectors Gold Miners ETF (GDX) has decreased by 11.5%, noting that gold prices remained stable over the same period while bitcoin experienced a surge of over 40%. The gold bug wrote:
Clearly gold stocks are a major source of funds fueling inflows into the new bitcoin ETFs. A gold rally should prick the bubble.
“The most likely explanation for the weakness in gold stocks is that investors are selling them to buy bitcoin ETFs instead,” he detailed in another post on X. “That means bitcoin has basically become a bet against gold. So when gold inevitably breaks out, the money to buy gold stocks will come from bitcoin ETFs.”
Schiff further opined:
Unfortunately for bitcoin ETF buyers, a lot less money will come out of bitcoin ETFs than went in, as the selling will cause bitcoin to crash. So most of the money to buy gold stocks will come from other sources.
On Wednesday, Schiff described on X: “Typically when an asset bubble develops, there’s at least some underlying value in an over-priced asset. But with bitcoin, there’s no value at all. Effectively it’s an asset bubble without a real asset. The ultimate bubble. That may be why it’s grown so large and lasted so long.”
Schiff’s posts attracted numerous comments, with many mocking the gold advocate for his persistent criticism of bitcoin. Alex Brammer wrote: “This account has officially transitioned into a therapy account for boomers hanging onto last century’s hard money thesis. And a comedy account for those of us that are living in the present. Study bitcoin.” Marc van der Chijs opined: “It’s kind of sad to see public tweets from old gold bugs who can’t see that the world has changed. Peter has been ranting against bitcoin for over a decade, it must be painful for him to be proven wrong time after time after time.”
Dave Weisberger said: “I am sure the wealthiest collector of seashells felt the same about silver & those with the richest silver hoard saw gold the same way … In the digital age, it’s Bitcoin’s turn.” Markshire B noted: “Peter is half right — the first half. Second half is probably not going to age well. Bitcoin is replacing gold just like digital music replaced records/CDs, Google replaced the yellow pages/maps, audible/eReaders replaced libraries, smartphones replaced calculators, etc.”