During an appearance on Patrick Bet-David’s podcast, President of Euro Pacific Capital Peter Schiff predicted a major crash for Bitcoin, describing it as a Ponzi scheme without any real value.
He stated that the rapid increase in Bitcoin’s value is solely driven by hype and the “greater fool theory”. Furthermore, he believes that the introduction of spot ETFs in the US will eventually lead to the downfall of this asset.
Schiff pointed out that investors who are participating in the growing Bitcoin exchange-traded funds are simply treating it as a speculative investment and are not true supporters of the cryptocurrency.
He has previously compared them to sectarians. According to him, as the demand for Bitcoin inevitably decreases, short-term holders of ETF shares will begin to sell off their positions, causing a chain reaction.
This will put pressure on issuers like BlackRock and others to sell their Bitcoin holdings on the spot market. As a result, they will need to convert them into US dollars, which could lead to insufficient liquidity in the market to handle such large transactions.
Schiff believes that this will ultimately result in “the biggest crash ever” for Bitcoin, and even lead to the bankruptcy of companies like MicroStrategy who have heavily invested in the cryptocurrency.
