Almost everywhere you can watch, the cryptocurrency community is in turmoil due to the upcoming halving Bitcoin BUY NOWthat is scheduled within 30 days. Gold investor Peter Schiff seems desperate to ruin the party, but warns that crypto investors should prepare for the pain instead of celebrating an upcoming milestone.
With major uncertainties around the world due to the coronavirus pandemic, including How to deal with the moment when the US economy gets going again? Only one certainty was real for the cryptocurrency community, and that’s the next halving event.
On May 12, the miner’s reward was halved from 12.5 BTC per block to 6.25 BTC according to the Satoshi Nakamoto network design. In the past, the event was optimistic about the price of Bitcoin, which fueled optimism among cryptocurrency investors that similar successes will be achieved this year. Even so, Peter Schiff, CEO of Euro Pacific Capital, warned Bitcoin holders in a tweet, saying that they are “about to learn a very expensive lesson in business”.
Trying to explain a the concept of money #Bitcoin Hodler is like hitting your head against a wall. These guys are going to learn a very expensive lesson in economics and gain new appreciation for the age old saying “easy come, easy go”.
– Peter Schiff (@PeterSchiff) April 13, 2020
The thing is, ship can’t see the forest for the trees. While he has been warning about an impending economic crisis and the fragility of the monetary system for several years, he refuses to recognize the common characteristics between precious metal gold and Bitcoin “digital gold”.
For example, both assets are scarce as only 21 million BTC and 171,300 tons of precious metal are mined. [BBC] Both gold and bitcoin can serve as a hedge against economic inflation and are known to trade uncorrelated with stocks, although bitcoin continues to seek consolidation. And perhaps most convincing is that neither gold nor Bitcoin are attractive to billionaire Warren Buffett. [Forbes]
“What is easy, is easy?”
Schiff also reminds her of the saying: “Easy to come, easy to go.” The problem with this theory, however, is that with a few exceptions, like the ICO-powered bubble in 2017, nothing about Bitcoin was easy.
The price of Bitcoin has put investors on a roller coaster ride that was unpredictable even among the most demanding traders. However, its value has risen to a current market cap of $ 123 billion in just over a decade, reflecting the value that investors are willing to assign to the cryptocurrency. Ask long-term investors who have weathered the storm whether recent earnings have been easy.
Bitcoin is also in the middle of its first real financial crisis, and while it has not always been easy, the flagship cryptocurrency is holding on.
The Bitcoin model has also threatened the status quo of traditional monetary policy, which is nothing short of a titanic task for any emerging asset class. Perhaps the crux of the matter for gold investors like Schiff is the fact that Bitcoin has introduced another investor’s savings and exchanges that threatens to steal more of the precious metal’s market share than it already has. .
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