Bitcoin
Peter Schiff Slams MicroStrategy’s Bitcoin Bet: ‘It Will Crash’
A well-known gold advocate denounced MicroStrategy’s investment plan to purchase more Bitcoin and build up its crypto reserve.
Peter Schiff, a vocal critic of the firstborn cryptocurrency, also slammed the pro-crypto stance of President-elect Donald Trump, arguing that it is detrimental to the country.
MicroStrategy’s Bitcoin Investment Strategy
MicroStrategy revealed that it has a $42 billion investment strategy to buy more Bitcoin in the next few years.
Analysts said that the American development company is known for purchasing a great deal of cryptocurrency regardless of market fluctuations.
Reports stated that MicroStrategy recently bought 55,500 BTC worth $5.4 billion, allowing the company to strengthen its position in the crypto sector.
As of press time, MicroStrategy owns 386,700 BTC worth over $36 billion, putting the firm among the biggest corporate holders of cryptocurrency.
A Dangerous Bet
Schiff criticized MicroStrategy’s continuous purchase of the digital asset, denouncing the $42 billion investment plan to acquire more Bitcoin within three years.
The Bitcoin critic described MicroStrategy’s BTC investment plan as “a dangerous bet.”
It’s now been four weeks since $MSTR announced its three-year plan to spend $42 billion buying #Bitcoin. MSTR has already spent $10 billion. At this rate, the three-year plan will be completed in about 16 weeks. Once the buying is done, expect both Bitcoin and MSTR to crash.
— Peter Schiff (@PeterSchiff) November 26, 2024
“At this rate, the three-year plan will be completed in about 16 weeks,” Schiff said.
He sees the price hike brought by what is called MicroStrategy’s “bold plan” will be short-term, leading to a considerable decline in BTC price and a drop in the company’s stock price.
Moreover, Schiff believes that the company’s large-scale purchase only brings an artificial price appreciation, noting that it may pose a problem to the firm because it put all its proverbial eggs in one basket which is not a smart concept in any investment.
BTC market cap currently at $1.88 trillion. Chart: TradingView.com
Schiff predicts that MicroStrategy might not be able to fund future purchases of Bitcoin, echoing his view that this move could possibly hurt both the company and its shareholders.
On the other hand, MicroStrategy executive Michael Saylor defended the company’s investment approach, saying that they have no plan of selling their crypto assets in the near future.
Image: ETMarkets.com
Saylor said that the company remains bullish on the future of BTC, urging other companies to draw inspiration from their investment strategy.
Historically, Schiff has been a staunch critic of MicroStrategy’s moves to buy Bitcoin.
Trump’s Pro-Crypto Stance: Detrimental To The Economy?
Schiff also criticized Trump in his plans to implement regulations that are pro-cryptocurrency, arguing that it will weaken the country’s economic standing.
“When the government picks winners and losers, it usually picks losers. Thanks to the Trump administration’s picking bitcoin, Wall Street is winning big by misallocating capital to BTC and related value-destroying businesses,” Schiff stated.
The staunch crypto critic believes that the US would become weaker once it became a Bitcoin superpower.
Meanwhile, crypto advocates dismissed Schiff’s opinions, saying that it is among the dumbest posts ever.
Featured image from FXLeaders, chart from TradingView
