Peter Schiff, CEO of Euro Pacific Capital and a well-known critic of Bitcoin, went into full doomsday mode yesterday with predictions of the collapse of the US dollar, the American economy, and, of course, Bitcoin. Schiff even went so far as to compare Bitcoin to the baby craze, noting that people at least use it to insulate their homes and push them against the walls when bubbles burst.
Bitcoin, however, should not be used at all, Schiff said. “Bitcoin is not a currency, it cannot be used as a means of exchange or as a unit of account. It can only be used for speculation.
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It is not a commodity because it cannot be used. It’s not an asset like real estate that doesn’t pay rent, it’s not a stock, it doesn’t pay dividends, it can’t be a bond, it won’t pay interest. Bitcoin is a collective symbol, Schiff argues. On the other hand, Bitcoin is not the only asset standing in its way.
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According to Schiff, the US dollar is also likely to slump. “There is no question that one of them will be the first to perish. The Bitcoin bubble will burst, and so will the dollar. We’re going to have a cryptocurrency crisis before we have a dollar crisis, “Schiff said.
We have an enormous government and a huge bubble economy that is sustained by an artificial suppression of interest rates. As long as this bubble continues to exacerbate underlying economic imbalances, it will be necessary to correct them before a major economic collapse.
He argues that people should detach themselves from state-provided income such as Social Security and taxes. Instead, people should save for their own retirement, rather than relying on government schemes.
The US economy is in a worse state today than it was in 2000. The imbalances are bigger, the debts bigger. There will be a greater fall in the dollar than in 2000 and 2008. The next crisis will be a dollar crisis and a sovereign debt crisis, Schiff concluded. In a cryptocurrency report, analysts at major US investment bank JPMorgan pointed out that bitcoin is not immune to global financial uncertainty and shows weakness.