According to Schiff, although Bitcoin has managed to rally slightly after crashing to around $18,000, a section of the market believes the price movement is part of recovery, but he termed it as ‘a false sense of security’ during an interview with Natalie Brunell on October 4.
“Bitcoin has trended sideways ever since it crashed down below $20,000, but it hasn’t rallied. There is a lot selling around $20,000. There are still some people trying to buy it around that level as well, so you’ve got kind of a battle going on between the people that are trying to buy it, just below $20,000, and the people who want to sell it above $20,000 but don’t let that lure you into a false sense of security,” he said.
Furthermore, the economist stressed that Bitcoin is in line for a drop to zero, noting that investors should treat it as a false hope despite the consolidation.
Bitcoin likely to hit $5,000
Under his projection, Schiff noted that Bitcoin would likely go to $10,000 and then $5,000. He stressed that institutions no longer get into Bitcoin while terming the asset as a scam.
“But the bottom is going to drop out of that market, just because it’s temporarily stopped falling, you know that’s what bear markets do. They kind of trap you in there. They try to give you a false sense of hope that the lows are in, and then we get another big leg, and you know maybe we’ll end up spending a lot of time around $10,000,” he added.
Bitcoin’s status as a store of value
Finally, due to Bitcoin’s significant crash from the all-time high of almost $68,000, Schiff questioned the asset’s status as a store of value while challenging investors to opt for other assets like gold and the dollar.
In the meantime, he noted that the biggest winners of Bitcoin are the sellers, terming the buyers as losers. Previously, Schiff challenged Bitcoin holders to sell the asset after it temporarily gained in what he termed a ‘sucker rally.’
Watch the full interview below:
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