​Peter Schiff explains the reasons for the growth of BTC and gold in 2023

What’s new? Peter Schiff, CEO of the brokerage firm Euro Pacific Capital, said that bitcoin and gold prices are rising in 2023 for different reasons. The economist explained that investors view the precious metal as a hedge against inflation, while the cryptocurrency is rising along with other high-risk assets. According to Schiff, speculators bet that a policy easing by the US Federal Reserve (Fed) will trigger a rally in the field of digital assets, which have been hit hard in 2022.

Both #gold and #Bitcoin are up in 2023, but they're rising for opposite reasons. Gold is rising as a hedge against #inflation and a weaker #dollar, while Bitcoin is rising with other high-risk assets as speculators bet that a #Fed pivot will cause a rally in 2022s biggest losers. — Peter Schiff (@PeterSchiff) January 23, 2023

Community reaction. Some Twitter users disagreed with Schiff that gold protects against inflation. In particular, a user under the nickname Tajo Crypto said that bitcoin, unlike precious metal, is a supply-limited asset and has made tremendous progress over its several years of existence. According to him, BTC “is the best hedge against inflation because its returns are massive over time.”

In response, Schiff countered that there are 2,1 quadrillion satoshis (the smallest fractional part of bitcoin) in the world, and each person would have several hundred thousand of these coins if distributed. However, he said, their number is irrelevant because the demand for the asset is fickle and only observed by speculators.

There are 2.1 quadrillion Satoshis in the world, enough for each person to have several hundred thousand. But since there is nothing anyone can do with a Sat in makes no difference how many one has. Massive supply but no real demand other than temporary demand from speculators. — Peter Schiff (@PeterSchiff) January 23, 2023

Commenting on Schiff’s January 12 tweet in which the economist advised investors to sell BTC at $18 000, What Bitcoin Did podcast host Peter McCormack noted that since then the price of bitcoin has increased by about 27%, which cannot be said about gold.

#bitcoin is trading around 27% up since @PeterSchiff advised you to sell your $bitcoin. Gold isn't. pic.twitter.com/cookRRax45 — Peter McCormack🏴‍☠️ (@PeterMcCormack) January 22, 2023

While acknowledging that the price of bitcoin has risen since he advised people to sell their coins, Schiff noted that he gave the same advice when the price of BTC was well above $60 000.

In addition, Schiff commented on his poor predictions about bitcoin on January 24. He stated that the only thing worse than his advice to sell BTC before a 30% rally could be to participate in that rally and the subsequent collapse to even lower levels.

Do you know what's worse than advising people to sell #Bitcoin, then watching it rally 30% over the next week? Owning Bitcoin, watching it rally 30% in one week, not selling any, then watching the entire rally reverse and Bitcoin crash below the level it originally rallied from. — Peter Schiff (@PeterSchiff) January 24, 2023

In September 2022, Schiff stated that supporting bitcoin at $20 000 is not real and would end up being a false bottom. Such a value, he said, would allow short-sighted investors to “climb aboard a sinking ship” and lead to a loss of funds. In November, following FTX’s bankruptcy, Schiff said Binance could also fail, with no bailouts in sight. He added that “the race to get out of BTC is on” on the market.

According to ARK Invest CEO Cathie Wood, inflation will begin to decline as early as the first half of 2023, followed immediately by the Fed’s interest rate cuts.