Economist and Bitcoin (BTC) skeptic Peter Schiff has extended his criticisms of the asset, dismissing its recent short-term gains while noting that it’s an opportunity for investors to sell and exit the market.
Speaking during an interview with Kitco News on August 11, Schiff stated that Bitcoin will likely correct further to $10,000 and will unlikely experience any other high like the rally in 2021.
According to the chief market strategist of Euro Pacific Asset Management, the broader crypto market gains are not sustainable, terming it a ‘sucker’s rally’.
“The market is going to plunge. I think people should take advantage of the sucker’s rally they’ve got right now and get out. A lot of people still have profits in these tokens. People bought Bitcoin four, five, six years ago, and they have big profits. Same thing with Ethereum (ETH). People should get out, because otherwise, the market’s going to take those profits,” he said.
Crypto market bubble to burst
He further stressed that the crypto market is in a bubble that will soon burst, and the 2022 correction reflected a massive pump and dump. Schiff stated that the market experienced a massive pump following increased crypto promotion, but investors were not looking at the dump.
Furthermore, Schiff, who recently reached a deal with Puerto Rican authorities to liquidate his Euro Pacific Bank, called out institutions that invested in Bitcoin, claiming they would regret the move unless they sold. Notably, the involvement of institutions in Bitcoin was vital in driving the market rally in 2021.
Schiff’s take on MicroStrategy Bitcoin losses
Furthermore, the economist singled out MicroStrategy, stating that the company’s Bitcoin strategy has not worked, as highlighted by the losses incurred.
He questioned MicroStrategy’s outgoing CEO Michael Saylor for maintaining that the company is making profits from its first Bitcoin haul. Also, Schiff said he is willing to debate Saylor on the company’s Bitcoin adoption strategy. However, he claimed that Saylor has turned down his invitations to debate.
It is worth noting that by Q2 2022, MicroStrategy’s Bitcoin holdings were valued at almost $2.96 billion, against the acquisition value of $3.975 billion.
With several businesses like lending platform Celsius filing for bankruptcy, Schiff believes MicroStrategy is in line to collapse, noting that the stock is overvalued.
“Eventually, the price of MicroStrategy shares is going to crash, and it’s going to be way below where it was when they first started to buy Bitcoin,” he said.
It is worth noting that for 2022 Q2, MicroStrategy reported quarterly revenue of $122.1 million against expectations of $126 million. The company also recorded a loss of $918.1 million, with $917.8 million attributed to the company’s Bitcoin holdings.
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