With bitcoin down at $16,500 and most cryptocurrencies down more than 90% since the top around a year ago, Peter Schiff’s predictions are looking more likely to come true.
Peter Schiff is a long time critic of the cryptocurrency industry, and even as the sector went through the good times he always maintained it would go to zero.
With crypto still in the depths of winter the renowned economist and CEO of Euro Pacific Capital has been proven right so far. However, for him, it’s not even about crypto winter.
“This is not a crypto winter. That implies spring is coming. This is also not a crypto ice age, as even that came to an end after a couple of million years”. This is crypto extinction.”
Such a view is likely to find a lot of sympathy from those who believe in the banking system, as well as those who have perhaps been badly stung by holding particular cryptocurrencies that have lost nearly all of their value.
It is to be wondered what Schiff would say on the ideals of crypto. He surely recognises that the monetary system as we know it is on life support. The fact that he is putting much of his wealth into gold would probably bear testament to this.
Many of the harshest critics of crypto could perhaps understand why Bitcoin was invented. Unless they are deeply embedded in the traditional financial system, then they could maybe understand why it was necessary to have a people’s currency that couldn’t be manipulated by the government or central banks.
As things stand, this ideal is being sorely tested. The monetary system is melting down, and cryptocurrencies and bitcoin being perceived as high risk investments, have suffered the most.
Also, the fact that some of the biggest crypto lenders were to all intents and purposes following the fractional reserve banking model, led to them failing, without the Federal Reserve being there to bail them out, as in the traditional financial system.
CBDCs fast approaching
So given the current predicament for crypto, Schiff is looking pretty smug on his forecast. However, when central bank digital currencies get rolled out, perhaps as early as 2023, Schiff might find himself casting around for an asset that is truly outside of the financial system.
Gold or silver held in physical form could be that asset, but in a world of digital value, cryptocurrencies would be so much more versatile and useful. However, with what could be the most heavy and repressive regulations fast approaching, it remains to be seen if crypto can survive in order to be that alternative.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.