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Peter Schiff: "I May Have Influenced More People To Buy Bitcoin Than People Who Advocate Bitcoin" | Markets Outlook
00:25:23
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- [00:00]
A
The problem is Bitcoin represents the ultimate trust. I have to trust that people continue to believe that nothing is something and that they don't wake up to reality. I don't want to put my faith in that. I can't trust that.
- [00:23]
B
Break the cycle of exploitation. Break down the barriers to truth. Break into the next generation of privacy. Break free. Free to scroll without being monetized. Free from censorship. Freedom without fear. We deserve more when it comes to privacy. Experience the next generation of blockchain that is private and inclusive by design. Break free with midnight. Visit midnight.networkbreak-free hey everyone, I'm Jen Senasi and you're watching markets outlook on CoinDesk. I'm joined today by Euro Pacific Asset Management senior economist and founder of Schiff Gold, Peter Schiff, who has made CoinDesk's most influential list this year. On the back of Gold's impressive performance, Peter joins me now to reflect on a standout year for gold. Hey, Peter.
- [01:05]
A
Hey, Jen. How are you?
- [01:06]
B
I'm doing well, thanks. I got to ask you, did you ever think you'd be nominated on the most influential list by a crypto publication?
- [01:14]
A
Well, you know, I've had that before. I don't remember where it was where they listed me as being one of the most influential people in crypto, even though I was the only person on the list that was critical of crypto. But they still acknowledge the fact that I was influential. And in fact, you know, I know firsthand that despite my. My criticism of crypto, a lot of people own bitcoin in particular because of me. So I have influenced a lot of people to buy bitcoin, even though that was not my intention. But I may have influenced a lot more people to buy bitcoin than the people who have advocated bitcoin.
- [01:53]
B
Have any of the folks you've influenced to buy bitcoin reached out to you and shared their stories? Like, how do you know that you.
- [02:00]
A
Well, I know that for a fact. But I've been talking about my recent experience at the bitcoin conference that was in Las Vegas in May. And hundreds of people came up to me individually to tell me that I was the reason that they owned bitcoin. And they basically credit me for awakening them to understanding Austrian economics, sound money. And ultimately, I set them on a journey that, that led them to bitcoin, even though that was not where I was hoping they would be led. Right. But I put them on that path that eventually caused them to find bitcoin. But had it not been for Me, they never would have gotten on that path in the first place. So that's what they credit me for. This has been the case for a long time, and I knew about that before I went to the conference. But, you know, I was really overwhelmed by the number of people just coming up to me, one after another to thank me.
- [03:01]
B
Well, Peter, I mean, correct me if I'm wrong, but it seems like you really try and steer folks away from bitcoin. When those people are coming up and thanking you and telling you they're on the path. They're on the path of discovery for bitcoin and maybe other crypto assets, do you feel like you're maybe not achieving your goal?
- [03:16]
A
No. No. Well, I mean, look, obviously there are plenty of people who bought gold, right, instead of bitcoin, And I guess, you know, some of those people are worse off. They. If they would have bought bitcoin, they could have sold it and had even more gold. But the problem is, a lot of people who bought bitcoin aren't selling it. And so, at the end of the day, they're going to end up losing a lot of money. But, yeah, I mean, that's the ironic part about it, is that, you know, when I'm educating people about economics and sound money, I wasn't intending that they would take all that education and then squandering it with bitcoin, but that's what happened. But as you know, as it turns out, people who did end up buying Bitcoin 10 years ago, five years ago, despite my criticism of bitcoin, but they bought it because of the education that I helped them get on economics. And then they came to the conclusion that I was wrong on bitcoin, and they bought it. And, yeah, they ended up making a lot of money. And, you know, they. They thank me because they recognize that without me, they never have made that fortuitous mistake which ended up enriching them.
- [04:27]
B
All right, we're going to come to bitcoin in just a little bit. But I want to talk about gold, since that's why you made the list this year. Let's just reflect on 2025 for a second and talk about some of the key moments for you that drove gold to a record high of over 4 to $300 an ounce in October.
- [04:44]
A
I think that, you know, the events of 2025 are really a continuation of the events of 2024, because gold had a huge year then as well. That's when gold really broke out above 2000 and went from 2000 to 3000 and then it went from 3000 to 4000. Obviously, the election of Donald Trump, a lot of people thought that would be a game changer for gold. A lot of people got bearish on gold after Trump won. And gold stocks in particular got sold off pretty hard in the fourth quarter of last year, mainly because of the Trump victory, which people thought would be perceived as being gold negative. But I was pretty sure that the inflation under Biden would continue under Trump, and certainly the reckless monetary policies would continue at the Fed. And so I didn't see any reason for the gold bull market to suffer based on any policies that Trump would would implement. In fact, I thought that Trump's policies would fuel the fire that was causing gold to rise. He's continuing the reckless government spending that we had under Biden. He is advocating for policies that are very destructive to the value of the dollar. He wants the Fed to slash rates. He wants more qe. He wants to put a bunch of political hacks on, on the Fed. You know, he wants bigger deficits. He wants to get rid of the debt ceiling and, you know, the tariffs. All the things that he is promoting and proposing are inflationary and therefore good for gold.
- [06:19]
B
Given that trajectory, where do you see us heading in 2026?
- [06:23]
A
Well, I think we continue heading higher. I mean, gold has been going up rather consistently for 26 years. I mean, gold was under 300 in 1999, 2000. So, you know, we've had a major bull market. There was a period of sideways action for gold that spanned about a decade. So gold made an initial big move from under 300 to 1900. That took about 10 years. And then from 2011 to really 2024, gold went sideways in a range. It initially pulled back to 1,050, then went up to 2,000. But, you know, it spent a lot of time at 1500, 1600, 1700, but it really couldn't get much above 2000. That was a consolidation. And that was the time period where bitcoin really came to the attention of a lot of frustrated gold bugs that were watching gold go sideways. And that's where bitcoin became popular. And it kept going up and up and up as gold didn't go anywhere. And that really fueled the narrative that, hey, gold is over. It's old school. Bitcoin is the new gold. Look at how much it's going up, right? So this is what you need to buy. If you're worried about inflation and quantitative easing and big deficits and a dollar crisis, you should be buying Bitcoin, because, look, everybody is making money buying bitcoin and no one's making money in gold. And that that changed in 2024 when gold finally broke out. And I think gold is now in another phase, similar to what we saw from 1999 to 2011, where we're going to see, you know, steady and substantial gains. And I think that's the environment where the whole bitcoin narrative is going to fall apart. Because once gold is performing and gold bugs are being rewarded, they don't need to look for an alternative.
- [08:27]
B
We'll come back to bitcoin in just a second. But if gold continues to outperform, continues to climb higher, what does that say about the economy?
- [08:36]
A
Well, it doesn't say good things. Right. I think, first of all, you had some Fed officials out today. You know, they're talking about how inflation expectations are contained and they're bragging about that they're not contained. That's what $4,000 gold is saying. If people weren't worried about inflation, they wouldn't be buying gold. I mean, that is the primary driver. And in fact, central banks. Why are central banks buying gold? Because they know that they will lose if they hold dollars because inflation will erode away. The value of the yields on Treasuries are not high enough to compensate holders for what they're going to lose to inflation. So foreign central banks have been moving out of dollars into gold because inflation expectations are anything but contained. So this is a negative. It's a warning sign that is going unheeded by, by most. And it also reveals that all of the nominal gains that we've seen over the course of this century are an illusion. That, yes, the Dow Jones is almost 50,000 and it started this century at about 10 or 11,000. So it's up, you know, almost 5x. But in terms of gold, the Dow's down 70%. And so gold is real money. And so if you're going to price the Dow in real money, the price has gone way down. It's only when you price it in funny money and fiat, right, that's losing value, that it looks like the Dow is gaining value, but it's not. You just are pricing it in a currency that's losing value.
- [10:13]
B
Peter, I gotta ask you, despite your criticisms over bitcoin, Bitcoin believers will say that it is sound money. It's hard money because there's limited supply. It can't be taken away from you. It's becoming more and more accepted by governments. I think recently we saw The Czech central bank has purchased some Bitcoin. What do you say to those folks?
- [10:33]
A
Well, just because it's scarce doesn't make it sound money. I mean, there are a lot of things that, in theory, could be scarce. What really makes sound money sound, and not the fact that you could drop it on the table and you can hear the sound, because that's kind of where the word comes from, the sound that money makes. Right. Bitcoin doesn't make a sound because it doesn't have any substance. You can't drop it on the table. You can't drop it on anything because it's nothing. It's just a string of numbers. From that perspective, yeah, it's not sound money, but. But what really differentiates sound money, right, other than the substance of it, you know, versus paper money, which, when you drop it on the table, it makes no sound at all. Is that real money? Sound money is, you know, a commodity, whether it's gold or something else that's been used as money. It has its own intrinsic value, separate and apart from the fact that it is a medium of exchange or a unit of account. And it derives its value from those properties that it has. Right? Whereas a fiat currency, its value is derived by confidence. Now, a lot of that confidence is instilled by governments that mandate its use and make it legal tender and collect taxes in it. But at the end of the day, what really gives it value is a belief system, is that people believe that it has value. They expect that other people will accept it in the future because they will believe it has value. So it's all about confidence and trust. In sound money, you don't have to have confidence or trust. You have the money. It speaks for itself. When you have gold as money, I don't have to trust a politician. I don't have to trust anybody, because gold is a actual precious metal that has its own unique and valuable properties. Sam.
- [13:08]
B
I mentioned before, governments are starting to accept bitcoin, especially in the United States. There are central banks like the Czech central bank looking at acquiring Bitcoin. If that continues to happen, does that change your perspective at all?
- [13:24]
A
Well, I don't think governments are looking to acquire Bitcoin. Central banks have been big buyers of gold. They have not been buyers of of bitcoin. I mean, you could throw out a couple of examples, you know, El Salvador, but a lot of that is more just PR and to try to lure some crypto money into the country. And I think to the extent that you have politicians talking about governments buying Bitcoin, they have been heavily influenced by the crypto industry that has made significant donations to their campaigns. And so the reason politicians are advocating that governments buy bitcoin is to reward the people who own bitcoin who have contributed to their campaigns. And the idea behind all this government rhetoric is to sucker more people into buying bitcoin. So I don't believe any of this is legitimate. I don't think governments are now realizing they need to own bitcoin. This is just pandering to a special interest group that now has a lot of influence over politics. So none of this is changing. It's not getting adopted. You know. Yes. You know, some governments are also lightening some of the regulation. And again, a lot of that is due to the influence that the crypto industry has. But I think that influence is going to go away as the crypto industry implodes, which is what's happening right now.
- [14:53]
B
Peter, you mentioned crypto markets down. We're recording this in November. Broader markets are down as well. I got to ask you this. There was that big liquidation event on October 10th. I went to several crypto events after that, very institutionally focused events. And some of the largest funds, the largest asset managers are all in on their crypto strategies. They're, they're still moving full steam ahead despite that liquidation event. Doesn't that say that maybe we've moved beyond some of the narrative that you've just outlined?
- [15:30]
A
No, I mean, I think that that big liquidation is just a small taste of what's going to come. It just shows you how vulnerable these markets are, how susceptible they are to, you know, those type of collapses. And I think the next one is going to be bigger. I also think that a lot of investors in ETFs are going to bail. I, I don't think that most ETF owners are your die hard bitcoin maxis, who, you know, truly believe in, you know, the promise of bitcoin and all that it's supposed to be. And I, and I think a lot of those people, you know, really do believe it. I mean, I've, you know, I've spoken with so many of them over the years that a lot of it is sincere. They're good people and this is what they believe. I think they're wrong, but they hold their beliefs sincerely. But a lot of people that came in, in the last few years really don't care. They just want to make money. They just bought Bitcoin ETFs because they were going up and because there was all this hype about bitcoin and how high it's going to go. And people just wanted to jump on that bandwagon. It was the fear of missing out. They wanted to buy it. So I think that a lot of that money is going to come out and it's going to come out very quickly and it's going to cause a complete collapse, because I don't see the other side of the trade. I know that over the last several years, as money was going into the ETFs, the OGs, you know, the whales, were happy to gradually sell their bitcoin to the ETF buyers. But when the ETF buyers look to liquidate en masse, I don't see who's going to want to buy all that bitcoin. And they're not going to be able to manufacture tether to buy that bitcoin, because when people sell their Bitcoin ETFs in their Schwab accounts or their Fidelity accounts, the buyers have to pay dollars. They can't pay with tether. So that's going to be a big deal. And I think all these bitcoin treasury companies that have been buying bitcoin are going to be selling their bitcoin because all these companies are going bankruptcy. They don't have a viable business, right? If you set up a business and your whole business model is buying bitcoin, you don't have a business, right? Anybody can buy bitcoin. They don't need a company to do it for them. So it's so nonsense. And of course, the poster boy for this ridiculous business model is microstrategy or strategy. And strategy is going to blow up. I mean, their premium has already vanished. So they barely traded a premium now to their Bitcoin. It's going to be trading at a discount. Right now the stock is already down 65% from where it was a year ago, and it's going to continue to implode. I think that strategy is going to lose access to the capital markets. It's been able to sell stock and sell preferred. I think all that's going to stop. And of course, the minute strategy is trading at a discount, it can no longer generate a bitcoin yield. And, you know, yield is a deceptive term because there is no real yield. But what strategy was doing was selling stock at a premium and then using the difference to buy more Bitcoin so that the amount of bitcoin owned per share would go up.
- [18:49]
B
Peter, I know that you've. You've challenged Michael to A debate on this. Has he responded?
- [18:56]
A
He never responds to me. Although, you know, when I was at the bitcoin conference in Vegas, he did mention my name twice during his speech, but that's about it. But, you know, he's been ducking debates with me for years. People have offered, a lot of people have tried to host the debate. I've accepted every invitation and he's turned them all down. But I challenged him because I'm going to another bitcoin event in Dubai. I'm going to have a debate with CZ and we're going to debate bitcoin versus tokenized gold, which is a different debate than I've had in the past. I think that rather than killing off gold, a blockchain could give it a whole new lease on life. I think blockchain could make gold even more efficient, even more portable, even more divisible, even better money than it was before. So it's not that, you know, gold's going to be replaced, it's just going to be enhanced. And bitcoin ultimately goes away because there's no real reason to have it.
- [20:00]
B
I want to touch on two things with you, Peter. You mentioned it. Tokenized gold. That's something that you've said you plan to launch soon. Does this mean that you are bullish on real world assets and tokenized real world assets and disposal, despite the price action that happens on the other side of the crypto ecosystem?
- [20:19]
A
Well, look, to the extent that you can tokenize real assets and if there's a market for those tokens, and if those tokens somehow improve the marketability or the efficiency regarding ownership and transferring ownership of those assets, that might evolve. But you know, they've been talking about that for 10 years. They were talking about real estate being on the blockchain, you know, the title to your car being on the blockchain. Although they've been talking about this for a long time and none of it has happened. And now they're talking more about stable coins where you tokenize dollars. Right. And so make it another way to transact in dollars. We'll see what happens. But that's not, you know, as big a game changer as, as, as people are claiming. Right? They're just hyping this whole thing up to try to generate interest and push up the price so they can sell. But the point I was trying to make about this industry is now so much has been misdirected, we've wasted capital. And so we lose because we could have put that capital productive use. We Have a lot of people working in this industry. We're wasting human capital. They should be doing something more productive with their time. But sure, you know, things could come out of this, you know, like tokenized gold. If you go to my. My website now, T Gold, T stands for tokenized gold. So tgold. Com, if you go there, it's right now, it leads you to a page on shift gold where you can open up an account and buy some gold and silver that will eventually be tokenized, if that's what you want. I haven't started that phase of it yet. I'm kind of building this one block at a time. And so I have a lot of plans for what to do with this ecosystem. But for now, people can go to tgold.com and buy some gold and silver and, and own it. Because if I waited until I have everything set up to do that, the price of gold will be a lot higher, the price of silver. So let's start buying it now right before it gets any more expensive. But I'm going to find ways to build out that ecosystem where people can use that gold and silver as a medium of exchange to accumulate it and, you know, as in payment. So if you provide goods or services, get paid in gold, then you can save gold, you can send gold, you can gift it, earn it, spend it, use it as money, link a credit card to it, a debit card to it, all sorts of ways that people can debank themselves, get out of the fiat system and put themselves on a gold standard. And then one thing I do want to introduce ultimately is the ability to withdraw your gold, not just in a physical form, but in a token form. So you can take out a token that would represent ownership of your gold, and then you can send that token to whoever you want, and whoever receives the token now owns the gold.
- [23:02]
B
I do want to get you to respond to CZ's tweet about tokenized gold. He said it's not on chain gold. It's tokenizing that you trust some third party will give you gold at some later date, even after their management changes, maybe decades later, during a war, et cetera. It's a trust me bro token. This is the reason no gold coins have really taken off. How do you respond to that?
- [23:25]
A
Well, you know, there's always an element of trust in capitalism. You know, first of all, we were on the gold standard for thousands of years, and people had other parties that stored their gold and it worked. Right. Were there occasions where the custodian stole the gold? Sure. But you know, I talk about Brinks, which has been around for 160 years as a gold custodian, has never lost an ounce. So, you know, in, in capitalism, companies compete for reputation, for brand. And yes, make sure that if you own a token, you trust the issuer and the custodian that they are going to hold on to your, to your gold. You know, we trust third parties all the time in capitalism. I mean, insurance is a perfect example. We have an insurance industry that works. People buy fire insurance, they buy auto insurance. Right. They buy health insurance, but all these insurance policies, you have to trust the insurance company. You have to trust that if you put in a claim, they're going to pay it. And so you buy a policy from a company that has a good reputation, right. For paying claims, that has a balance sheet that will enable them to pay claims. So this is what you do. So, yes, make sure that whoever is custodian of your gold, do research, make sure they're a reputable company, make sure they have independent third party auditors. Right. That's what you do now. Yes, I get it that in Bitcoin you don't need any of that. Right. But the problem is Bitcoin represents the ultimate trust. I have to trust that people continue to believe that nothing is something and that they don't wake up to reality. I don't want to put my faith in that. I can't trust that.