Economist and gold advocate Peter Schiff has dismissed the idea that Bitcoin could become a global reserve asset. He claimed that the cryptocurrency lacks the intrinsic value of money to serve this purpose. According to him, the appeal of Bitcoin still rests on speculation rather than economic use.
The remarks from Schiff follow a fresh debate over alternatives to the U.S. dollar amid rising inflation and escalating government debt. The economist further said that Bitcoin still has fundamental monetary constraints despite increased political and regulatory backing for crypto in the U.S.
Peter Schiff Rejects Bitcoin as Reserve Money
In an interview with Tucker Carlson, Schiff claimed that a global reserve asset had to be reliable in storing value, liquid during crises, and demand-insensitive to speculation. Schiff argued that Bitcoin is neither generating income nor consumable, and is not useful in industries. He said the driving force behind the demand for the coin is expectations of a higher price in the future.
Schiff said Bitcoin was not money and would never be, as reserve assets must retain value beyond resale to further buyers. He further added that the scarcity, longevity, and industrial applicability of gold have always met these requirements.
Schiff has consistently argued for the precious metal over the flagship crypto. Last, there was a Bitcoin vs. gold debate between the renowned economist and Binance founder Changpeng “CZ” Zhao. CZ had presented his argument in support of BTC, based on verifiability, utility, scarcity, and performance over the years.
Meanwhile, during the Tucker Carlson interview, Schiff also claimed that central banks keep gold because its price is not affected by technology or investor sentiment. He further argued that central banks’ actions provide sufficient evidence that Bitcoin is not a reserve currency. Although crypto is gaining popularity, gold and not Bitcoin are still the major holdings of central banks.
Schiff’s latest comments come just as the gold hit a new all-time high (ATH) above $5,000 today, as traders turn to the precious metal for the debasement trade. On the other hand, Bitcoin is on a downtrend, dropping to as low as $86,000 yesterday, erasing its year-to-date (YTD) gains in the process.
Gold Retains Trust Over BTC
Schiff pointed out that the majority of government exposure to crypto has been through investment products, such as ETFs. He said that these allocations do not mean monetary approval. His position is reflected in comments made by BitMEX co-founder Arthur Hayes. Hayes said most nations still trust gold, but Bitcoin may be the future of money.
Schiff also criticized the crypto sector in its quest for regulatory clarity. He claimed that industry leaders want crypto regulation as a form of validation rather than focusing on addressing Bitcoin’s lack of intrinsic value.“They do not want clarity; they want validation,” said Schiff.
He remarked that U.S. President Donald Trump was actively promoting the crypto industry, which he believes is a waste of capital. As CoinGape reported, Trump stated during his Davos speech that he hopes to sign the CLARITY Act soon.
Meanwhile, the renowned economist compared the physical characteristics of gold and Bitcoin’s need for infrastructure. Gold requires no electricity, networks, or intermediaries to maintain its value, he argued.
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