Peter Schiff, a renowned investor, author, and financial commentator, who has consistently offered baseless condemnation on Bitcoin, has demonstrated why the demand toward Bitcoin and the cryptocurrency market can no longer be ignored.
On social media platforms, Schiff announced that GoldMoney, the parent company of SchiffGold, his gold businesses acquired in 2014, will be offering Bitcoin brokerage services to its clients. Schiff claimed that it is not an endorsement of cryptocurrencies but a response to the growing demand toward Bitcoin.
Bitcoin is not a bubble…
Throughout the past few years, Schiff has continuously described Bitcoin as a bubble. Schiff explained that Bitcoin was a bubble when the price of Bitcoin hit $2,000, $3,000, $4,000 and most recently, $5,000. In August, Schiff told Coindesk:
“There’s certainly a lot of bullishness about Bitcoin and cryptocurrency, and that’s the case with bubbles in general. The psychology of bubbles fuels it. You just become more convinced that it’s going to work. And the higher the price goes, the more convinced you become that you’re right. But it’s not going up because it’s going to work. It’s going up because of speculation.”
There definitely were bubbles in Bitcoin and cryptocurrency markets in the past. But, it is completely inaccurate to describe Bitcoin and the cryptocurrency market as bubbles. Schiff has always introduced the concept of intrinsic value to justify the superiority of gold over Bitcoin, but like any asset or currency, the value of Bitcoin depends on its market. Within the last eight years, the cryptocurrency market has become more liquid than the most liquid stock in the world, Apple.
Bitcoin is money…
Schiff fundamentally believes that Bitcoin is not money. By definition, money is a medium of exchange and the value of it should be dependent on the market and users. But, the value of government-issued fiat currencies are manipulated by central banks and were enforced against the will of the people, like the US government replacing gold with the US dollar. Whether Bitcoin is money or not, is not decided by the government or central entities. There are many users, merchants, and businesses utilizing Bitcoin as money, a digital currency, and a store of value. Hence, Bitcoin is money.
According to McAfee and Bank of Finland
As security expert John McAfee stated:
“It costs $1000 to mine one Bitcoin. What does it cost to print US dollar? Which one is the fraud?”
More to that, the Bank of Finland further emphasized in its research paper that Bitcoin is a decentralized financial network that cannot be regulated and censored by central entities, as it operates its own economy in a peer-to-peer ecosystem. It further encouraged economists to study the “marvelous” structure of Bitcoin.
“Bitcoin is a monopoly run by a protocol, not by a managing organization. Familiar monopolies are run by managing organizations, with discretion to determine and then change prices, offerings and rules. Monopolies are often regulated to prevent or at least mitigate their abuse of power. [Bitcoin’s] apparent functionality and usefulness should further encourage economists to study this marvelous structure,” read the Bank of Finland research paper.