Peter Schiff Predicts Bitcoin ETFs Will Lead To Its 'Biggest Crash Ever'

Khyathi Dalal

April 11, 2024

Bitcoin's (CRYPTO: BTC) ever-bearish commentator Peter Schiff commented on the crypto king, foreseeing its biggest crash and a potential MicroStrategy (NASDAQ:MSTR) bankruptcy.

What Happened: In his latest appearance on Patrick Bet David’s podcast called "Valuetainment," the economist explains how Bitcoin is going to witness its "biggest crash ever." The route to the crash is:

Speculative ETF buyers decide to sell.
ETFs must take Bitcoin and sell in the spot market.
"There won’t be enough liquidity to absorb that selling" and prices will crash.
After ETFs receive sell orders, BlackRock and other ETF issuers are forced to sell bitcoin.

Schiff also points out a historical trend: when Bitcoin dips, Tether‘s (CRYPTO: USDT) supply increases is used to push up the price of Bitcoin.

He is also curious why Michael Saylor, Executive Chairman of MicroStrategy, does things like levering up his balance sheet and selling his shares in the company. He adds, "Ultimately I think MicroStrategy goes bankruptâ€¦ eventually Bitcoin is going to crash."

He terms all this blockchain and Bitcoin as "Digital Ponzi or a pyramid."

Also Read: MicroStrategy Positions To Capitalize On Upcoming Bitcoin Halving: Analyst

Why It Matters: While the crypto community is eagerly awaiting the impact of Bitcoin halving on the crypto king’s price, historical trends indicate that in the two months after the Halving event, Bitcoin prices have witnessed a drop, picking up steam in the subsequent months.

Bitcoin is currently hovering around the $70,000 mark; however, the past month witnessed a 2.2% loss. In mid-March, Bitcoin peaked at its all-time high of $73,750.

In the most recent update, Benchmark analyst Mark Palmer has estimated MicroStrategy's Bitcoin holdings to increase to 298,246 by the end of 2025, up from the 214,246 bitcoins it held as of March 19.

In early April, Bitcoin's significant price drop led Schiff to comment that Bitcoin is a "fake asset." He also compared Bitcoin's risk to be higher reward in comparison to gold. He believes that Bitcoin can never hit a high in Gold and thus it "undermines the case for Bitcoin being digital gold."

What's Next: The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga's upcoming Future of Digital Assets event on Nov. 19.

Read Next: Is Bitcoin ‘Digital Gold?’ Peter Schiff Says ‘Perhaps It Never Will’ Make A New High Priced In Gold As Economist Shares Data That Undermines The Case

Photo: Wikimedia

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