Peter Schiff, an economist and long-term gold proponent, has made a new warning about the cryptocurrency market. He opined that Bitcoin and other cryptocurrencies would face intense selling pressure if gold continued to rise above the $4,000 per ounce level.
Schiff expressed his opinions on Twitter, stating that the optimism in crypto among Wall Street has become unsustainably high. He suggests that the gold rush might prompt investors to move out of cryptocurrencies and switch to safe-haven assets. Schiff further added that after the price of gold surpassed the $4,000 mark, the current strength of Bitcoin may be easily reversed, and the entire crypto market may fall to a lower price.
The caution is issued at a time when Bitcoin has fallen off its all-time high of $126,000. The asset declined to below 122,000 in the initial trade due to concerns about a possible three-week government shutdown in the United States. Other leading cryptocurrencies also registered losses, with Ethereum, XRP, and Solana falling between 4% and 6%. Also, BNB was able to record minor gains.
CoinMarketCap data shows that the total market capitalization of cryptocurrencies was approximately $ 4.16 trillion. The pullback occurs after several weeks of rapid gains, indicating that some buyers are taking profits as the market becomes more uncertain. This tendency, according to Schiff, may enter a new phase once gold prices continue to surge.
Also Read: Crypto Prices Today: Bitcoin Price Falls 2.27% to $121,748, Ethereum Slips 5.20% Below $4,500
Although Peter Schiff noted the threats to digital assets, other analysts offered a more positive view of Bitcoin. Bitcoin Tech entrepreneur Brian Shuster proposed that Bitcoin has the potential to provide stability relative to gold due to its growing usage and increasing market capitalization. He highlighted that the increasing institutional demand for Bitcoin can be used to make the price steady when it is fluctuating.
Schiff responded that even when the purchase of gold was concentrated in fewer investors, it might pick up pace in the case of a further rise in prices. He emphasized that gold will remain a reliable insurance against unstable economic conditions, whereas cryptocurrencies are still gaining favor with retail-level buyers. Schiff argued that there will eventually be a verdict on whether investors' behavior will determine whether Bitcoin can stand its ground as gold strengthens.
The controversy is an example of a perpetual rift between proponents of classic safe-haven assets and those of digital currencies. As gold rises to nearly $4,000 and Bitcoin reaches significant support lines, market participants take an interest in the movement of capital between the two industries.