Schiff Predicts Bitcoin 'Biggest Crash' and MicroStrategy Bankruptcy, Decries 'Digital Ponzi'

Peter Schiff predicts a catastrophic Bitcoin crash, attributing it to speculative ETF buyers selling off during a massive liquidity crisis. He believes this will trigger a domino effect, implicating ETF issuers and leading to a potential MicroStrategy bankruptcy. Schiff views Bitcoin and blockchain as a "Digital Ponzi" due to Tether's alleged price manipulation and MicroStrategy's financial maneuvers, highlighting historical trends that suggest Bitcoin's price drops after the halving event.

Peter Schiff Predicts Bitcoin's "Biggest Crash Ever" and MicroStrategy Bankruptcy

Renowned cryptocurrency critic Peter Schiff has issued a dire warning for Bitcoin and its major corporate proponent, MicroStrategy, forecasting a catastrophic price collapse and potential bankruptcy for the latter.

Schiff's Dire Predictions for Bitcoin

In a recent appearance on Patrick Bet David's "Valuetainment" podcast, Schiff outlined his rationale for Bitcoin's impending downfall:

• Mass ETF Selling: As speculative buyers withdraw from Bitcoin exchange-traded funds (ETFs), the resulting sell orders will flood the spot market.
• Liquidity Crunch: The surge in selling will overwhelm the market's liquidity, causing prices to plummet.
• ETF Issuers Forced to Sell: ETF issuers like BlackRock will be compelled to offload their Bitcoin holdings to meet sell orders, further exacerbating the price decline.

Schiff also highlighted a historical pattern: during Bitcoin price dips, the supply of Tether (USDT) tends to increase, suggesting that it is used to artificially inflate Bitcoin's value.

MicroStrategy's Vulnerabilities

Schiff raised concerns about MicroStrategy's financial maneuvers, including leveraged balance sheets and the sale of company shares. He believes that these actions increase the company's vulnerability to a Bitcoin price crash, potentially leading to bankruptcy.

Bitcoin's "Digital Ponzi Scheme"

Schiff disparagingly refers to Bitcoin and blockchain as a "Digital Ponzi" or "pyramid scheme," arguing that they are based on speculative value rather than fundamental economic principles.

Historical Halving Trends

While the cryptocurrency community eagerly anticipates the impact of Bitcoin's upcoming halving event, Schiff cites historical data showing that Bitcoin prices have typically declined in the two months following the halving.

Bitcoin's Current Market Position

Currently, Bitcoin hovers around the $70,000 mark, but has experienced a 2.2% loss over the past month. In mid-March, it reached an all-time high of $73,750.

Analyst Projections for MicroStrategy

Benchmark analyst Mark Palmer estimates that MicroStrategy's Bitcoin holdings will rise to 298,246 by the end of 2025, from 214,246 as of March 19.

Bitcoin's Institutional Acceptance and Future

Despite Schiff's bearish predictions, Bitcoin's influence as an institutional asset class is expected to be a key topic of discussion at Benzinga's upcoming Future of Digital Assets event on November 19.