According to Peter Schiff, the price of Bitcoin should fall below $20,000.
Peter Schiff is known both for being a strong supporter of gold and for being a detractor of Bitcoin. To be honest, in the past his predictions about Bitcoin have often not turned out to be correct, since he is an expert in gold and not in Bitcoin, but on gold he has been right.
However, part of his assumptions might be correct.
Summary
Schiff’s hypothesis
Today on X Schiff wrote that right now there is far too much complacency about the fact that the price of Bitcoin is even minimally close to a bottom at this stage.
His idea is in fact that the price of BTC should fall further, and that when it ends up breaking down below $50,000 it should trigger a rapid drop even below $20,000.
Moreover, according to Schiff this drop should be strong enough to shake the conviction of long-term HODLers, pushing many to finally throw in the towel.
It should be remembered that Schiff has been making similar predictions about Bitcoin for years, and so far they have all turned out to be incorrect. These too seem more like propagandistic statements than real forecasts made on the basis of objective data and sensible logic.
In fact, he also added that the collapse of Bitcoin could be a harbinger of further crashes also with regard to the prices of other risk-on assets, hypothesizing that this could be a catalyst to push investors towards value and safety (that is, also towards gold).
The collapse of the Bitcoin price
Starting from May 11 the price of Bitcoin went from $82,000 to $67,000, with an 18% drop in just over three weeks.
To be honest, a similar drop for Bitcoin cannot even be considered a real crash, but it is what has happened in recent days that has been more frightening.
In fact, starting from May 26, in just over a week it fell by 13%, going from $77,000 to $67,000. Although a similar drop is in some ways normal as far as Bitcoin is concerned, it can certainly seem worrying to many who are inexperienced with the crypto market.
However, it should be remembered that something similar had already happened between January and February.
Indeed, at that time it had fallen from $89,000 to $62,000, that is by 29% in just over a week. Therefore the crash of recent days has been even smaller than that of the end of January, both in absolute and in percentage terms.
The rebound
Moreover, at that time, once the crash was over, there was first an almost immediate rebound up to $70,000, followed by a period of descending sideways movement that lasted for almost two months, in turn followed by a real rebound that ended precisely at the beginning of May above $80,000.
The crash of recent days resembles in some ways that of the end of January, particularly with regard to one specific aspect.
In both cases it was mainly a capitulation of long positions, and in both cases this capitulation was exhausted in just over a week.
However, there are two relevant differences.
The first is that the crash of recent days was smaller, and the second is that at the beginning of February the rebound was immediate after having marked the annual low at $60,000, while today, with the capitulation over, the rebound has been minimal, almost imperceptible.
This suggests either that such a rebound has yet to occur, or that the decline may not be over. Indeed, the end of a period of capitulation does not rule out that sooner or later another one may be triggered, however it is very unlikely that it will be triggered immediately.
Bitcoin towards $50,000?
Although Schiff’s hypothesis seems in all respects to be merely propaganda in favor of gold and against Bitcoin, the idea that the price of BTC could fall to $50,000 is widespread.
It should be specified, however, that at this moment the phase of capitulation of longs really does seem to have ended, and for now there does not seem to be such selling pressure as to justify further immediate declines. Moreover, the bottom recorded today, below $66,000, is still quite far from the bottom of February 6 at around $60,000.
This, however, does not rule out that over the next few weeks, or perhaps the next few months, another phase of capitulation could be triggered. In fact, if at this moment there are very few long positions left to liquidate, in the coming months new ones could be opened, and therefore sooner or later a situation similar to the current one could occur.
There are many who expect Bitcoin at $50,000 by the end of the year, perhaps in the second half of autumn, but there seem to be very few who share Schiff’s hypothesis that if the price were to fall below this threshold it should end up heading even below $20,000.
Finally, it should not be forgotten that the gold rally ended in January, and for now there is no sign of a new one starting. Perhaps Schiff is just trying to promote gold in an attempt to trigger a new rally, which however at the moment does not seem likely to arrive, at least in the short term.
