Tag: Economist

Economist Peter Schiff Calls Bitcoin An ‘Imaginary Friend’ In Response To Jack Dorsey’s Hyperinflation Tweet

by NEWSBTC

Peter Schiff is an economist, gold advocate, and one of Bitcoin’s biggest critics. He has never liked the digital currency.

He believes that real value is derived from an asset’s ability to create commercial demand in markets; and always refers to gold as a perfect example of this. In contrast, he says that Bitcoin is nothing but an asymmetric store of value with no other use except attracting an endless supply of buyers for the limited supply of assets. In short, it is a Ponzi scheme. However, he has been proven wrong over and over again.

In his most recent critique of Bitcoin, Schiff said it is not a real asset. This was in response to a tweet by Twitter CEO Jack Dorsey about the possible arrival of hyperinflation in the U.S. soon.

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Schiff Responds To Dorsey

On Saturday, October 23, Jack Dorsey shared his opinion on the current economic situation in the U.S on Twitter. He tweeted about the imminent hyperinflation as a result of the constant money printing in the U.S., and how the rest of the world would suffer from it.

Related Reading | Is Hyperinflation Inevitable? Jack Dorsey Says It’ll “Change Everything”

In response, Schiff tweeted that people should not look to Bitcoin to save them because it is not a real asset. Instead, they should own real assets like gold.

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Another Twitter user commented that Bitcoin is, in fact, real. And that it has just surpassed the Swiss Franc in Market cap. At this point, Schiff replied, calling the cryptocurrency a “make-believe asset” and that it is the adult version of an imaginary friend.

Peter Schiff’s Grudge with Bitcoin

According to this Wikipedia profile, Peter Schiff is an American stockbroker, financial commentator, and radio personality. He is also CEO and chief global strategist of Euro Pacific Capital Inc., a broker-dealer based in Westport, Connecticut. Additionally, he is involved in various roles in other financial services companies, including Euro Pacific Asset Management, an independent investment advisor, Schiff Gold (formerly Euro Pacific Precious Metals), a precious metals dealer, and Euro Pacific Bank, a full-reserve bank.

In addition to all these, Schiff is known for something else – his grudge with Bitcoin. He has always claimed its value will one day drop to nothing.

Earlier this year, Mark Cuban told Schiff to “move on” because “gold is dead.” In Response,  Schiff said, “Mark, a lot of your athletes wear gold jewelry. Ask them why. Gold has many uses outside of jewelry that contributes to its value as a metal. It’s not hyped at all. Gold is money. Bitcoin is 100% hype. It’s nothing.”

Related Reading | Mark Cuban Slams Peter Schiff: Gold is Dead, Bitcoin and Ethereum Are Today

Cuban himself used to be a bitcoin skeptic, preferring bananas to bitcoin because he claimed he could at least eat a banana.

In an interview on Good Evening San Diego a few days ago, Schiff referred to Bitcoin as a fool’s gold and a digital pyramid scheme. He also said that the SEC should not be encouraging people to participate.

BTCUSD Chart on TradingView.com

BTCUSD Chart on TradingView.com


BTC trading at over $62K | Source: BTCUSD on TradingView.com

When asked about the SEC’s recent approval of Bitcoin ETFs, he responded that “we should get rid of the SEC”.

He continued by saying, “I have no problem with the ETF itself, but if the SEC is pretending that it is some kind of watchdog and trying to make sure that investors don’t get hurt, then it makes no sense that they would approve this ETF because ultimately, the ETF is going to collapse to zero and the people who are left holding the bag are going to get wiped out.”

Schiff is also not impressed with futures ETFs. He says, “instead of owning nothing, you own a futures contract to gamble on nothing.”

Featured image by Bloomberg, Chart from TradingView.com

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Economist warns of dystopia if ‘Bitcoin Aristocrats’ become reality

by Cointelegraph

Not everyone is excited about hyperbitcoinization. 

According to a popular copy/paste meme, Bitcoin holders are set to become a neo-aristocracy as Bitcoin becomes the dominant world currency:

The meme is part of a larger vision for Bitcoin’s future, a semi-serious but mostly tongue-in-cheek narrative that can be lumped under the “Bitcoin Citadels” umbrella: a vision of the future in which Bitcoin becomes so valuable that hodlers become lords quite literally defending their coins in castles. 

Originating from a Reddit post written by someone claiming to be a time traveler (they called for a $1 million price target in 2021, if you’re curious), the Citadel meme has taken on a life of its own, even inspiring a short film.

But despite the self-evident farce and fantasy behind the meme, one economist is now warning that it might not be far off from reality should Bitcoin succeed in its mission to achieve monetary supremacy.

On the think tank Center for Economic Policy and Research’s website, academic Jon Danielsson of the London School of Economics wrote an article yesterday in which he envisions a future where “Bitcoin aristocrats” will “fuel social division and populism” through extreme wealth inequality:

“To begin with, the current owners of bitcoin will become the wealthiest people in the world, rivalling the kings and emperors that ruled over empires in centuries past. They literally will own all the money. They can buy anything they want. There aren’t that many of them. Compared to the multitudes that own assets today via all the pension funds and mutual funds and the rest, it is a tiny group of people.”

The government would be forced to “protect or attack” this new class of overlords, ones who attained their “rank just by buying early. They will make no contribution to society.” 

Gloom and grumpiness aside, Danielsson ultimately concludes that such a future “cannot” come to pass because Bitcoin is unsuitable as a unit of account due to its price instability. Because of these “internal contradictions,” Danielsson writes, “the price of Bitcoin will head to zero.”

Economic analysis that comes to the same conclusions as time-traveling Redditors aside, not everyone is as grim about a hyperbitcoinized world. In fact, in many cases it has proven to be a boon for countries struggling under inflation.