Gold advocate and Bitcoin opponent economist Peter Schiff painted a rather pessimistic picture for Bitcoin (BTC) following the US midterm elections. Schiff argued that markets have not yet fully priced in the potential impact of political developments on the cryptocurrency sector, warning that a much larger decline in Bitcoin is possible.
Speaking on The Peter Schiff Show, Schiff suggested that despite Bitcoin losing approximately 3% of its value in the past week, the real sell-off has yet to begin. According to the economist, Bitcoin continues to move in tandem with technology stocks rather than gold, which is seen as a safe haven.
Schiff noted that Bitcoin was trading at approximately $75,900 at the time of his statement, pointing out that this level was quite close to Strategy’s average Bitcoin purchase cost of $75,500-$75,600.
Peter Schiff: “The Real Big Drop in Bitcoin Hasn’t Happened Yet”
Schiff drew a comparison between the rise in Bitcoin following the 2024 US presidential election and the current political climate. He recalled that after Donald Trump’s election victory, Bitcoin initially showed a limited rise, then experienced a strong rally that reached $126,000.
The economist argued that a similar process could occur in the opposite direction this time.
Schiff stated that he believes the Bitcoin price is about to collapse, adding that the current decline may only be the beginning. According to the analyst, investors have not yet fully grasped the implications of the Republicans’ midterm losses for Bitcoin.
At the heart of Schiff’s assessment is the possibility that the political support he believes the Trump administration provided to Bitcoin may disappear.
“The 2028 Elections Could Pose a Major Risk for Bitcoin”
Schiff predicted that the Democrats would win the 2028 presidential election and secure a strong majority in Congress. He argued that such a scenario would create a much more unfavorable regulatory environment for Bitcoin and the cryptocurrency sector in general.
Schiff stated that Trump’s policies, which were supportive of the cryptocurrency sector, increased investor interest in Bitcoin, and that the end of this political support could have significant consequences for the market.
The economist suggested that if the Democrats win the White House in 2028, the US might abandon its plans to expand its strategic Bitcoin reserve.
Schiff went even further, claiming that a potential Democratic administration taking office in 2029 could sell the Bitcoins held in the US strategic reserve regardless of market price.
According to Schiff, the positive political atmosphere created for the cryptocurrency sector during Trump’s presidency was one of the key factors supporting the rise in Bitcoin’s price. With the loss of this support, investors’ expectations regarding Bitcoin could change significantly.
Strategy Also Criticized Bitcoin Investments
Schiff also targeted Strategy’s Bitcoin accumulation strategy, which is led by Michael Saylor.
Schiff noted that the company has been buying Bitcoin for over six years, and that at the time the program was recorded, the BTC price was only slightly above Strategy’s average cost of purchase.
The economist argued that the company could have achieved a much higher return if it had invested in gold or the S&P 500 index instead of Bitcoin during the same period.
Schiff also noted that the company’s Bitcoin investments fell considerably short of Saylor’s earlier expectation of a 30% annual increase in value.
Schiff Chose Gold and Silver Instead of Bitcoin
Schiff noted that while Bitcoin fell by approximately 3% on a weekly basis, gold rose by about 2.75% and silver by 2%. He interpreted Bitcoin’s synchronization with the Nasdaq as a development supporting his view of the digital asset’s safe-haven status.
Schiff predicted that budget deficits would grow, inflation would accelerate, and the dollar would depreciate in the US, arguing that these economic conditions would increase demand for gold and silver.
An economist, speaking directly to Bitcoin investors, argued that they should sell their BTC and switch to physical gold and silver.
Schiff reiterated his view that the cryptocurrency market survives thanks to political support, arguing that current price levels may not be sustainable as the Trump administration’s influence on Bitcoin diminishes.
*This is not investment advice.
