Prominent economist and cryptocurrency critic Peter Schiff has recently issued a stark warning about the future of Bitcoin (BTC).
In a series of social media posts, Schiff expressed his belief that imminent regulatory changes, spearheaded by Securities and Exchange Commission (SEC) Chair Gary Gensler, could significantly impact the cost and viability of Bitcoin transactions.
"I think [Gensler] will soon introduce new onerous crypto regulations that will substantially increase the cost of Bitcoin transactions, further undermining its 'use' case, resulting in a sharp decline in price," Schiff said.
Regulatory changes on the horizon?
Schiff's primary concern centers on the potential introduction of stringent new cryptocurrency regulations by the SEC.
He believes that these regulations could dramatically increase transaction costs for Bitcoin, thus undermining its utility and leading to a sharp decline in its price.
Schiff's prediction arises from his interpretation of Gensler's recent actions regarding the approval of spot Bitcoin exchange-traded funds (ETFs), which he sees as a reluctant concession that could potentially trigger more aggressive regulatory measures.
Amid these debates, various social media users pointed to Gensler's previous classification of Bitcoin as a commodity.
This categorization could make extensive SEC regulation challenging. However, Schiff argues that the focus of new regulations may be more on anti-money laundering (AML) rather than securities law.
Schiff's skepticism
In other recent comments, Schiff has consistently questioned the intrinsic value and utility of Bitcoin.
He has pointed out the complexities and costs associated with buying Bitcoin directly, arguing that the need for third-party custodians contradicts its original premise of eliminating intermediaries. Schiff's skepticism extends to the utility of Bitcoin as a currency, a view echoed by investor Mohamed El-Erian on CNBC, and the rationale behind investing in Bitcoin ETFs.
Furthermore, Schiff foresees most inflows into Bitcoin ETFs as being redirected from other Bitcoin proxies, likening this to rearranging deck chairs on a sinking ship.
He questions Bitcoin's status as a store of value and its real-world utility compared to traditional assets like gold.
Vladislav Sopov
Gamza Khanzadaev
Denys Serhiichuk
