A financial commentator warned that Bitcoin The US dollar could potentially weaken if the government intervenes in cryptocurrencies.
Economist Peter Schiff believes that if the US government decided to adopt crypto for the first time, it would adversely affect the greenback by increasing the money supply.
unforeseen consequences
Schiff, who is a well-known Bitcoin critic, said it would have unexpected consequences for its value. us dollar Once the US government continues its plans to intervene in the Bitcoin markets, it could lead to an unsustainable economic bubble.
Financial commentators believe that the surge in Bitcoin’s price is largely due to government interference, which they say could have a negative impact in the long run that could ultimately lead to the collapse of the global currency.
In a post, Schiff argued that cryptocurrencies could destroy the US dollar because of the government’s adoption of them.
Ironically, #bitcoin Eventually the dollar may collapse – not because it replaces the dollar as the global reserve currency, but because the US government adopts Bitcoin, prints trillions of dollars to buy it, and inflates a massive bubble. Which ruins the country’s wealth.
– Peter Schiff (@PeterSchiff) 5 December 2024
“Ironically, #Bitcoin could ultimately destroy the dollar – not because it replaces the dollar as the global reserve currency, but because the US government adopts Bitcoin, printing trillions of dollars to buy it. ‘, and fuels a bigger bubble that squanders the nation’s wealth,” Schiff commented.
According to him, mass crypto adoption by the US government would mean buying Bitcoin with newly printed currency that could potentially increase the money supply, adding that the US could end up in a massive economic bubble.
He said such crypto interference could also reduce investor confidence in the US currency.
BTCUSD trading at $99,325 on the daily chart: TradingView.com
political lobbying
Schiff argued that Bitcoin’s exponential growth allowed it to go beyond $100,000 mark Not driven by organic market demand, saying that crypto reached that milestone due to political lobbying and government support.
It is ironic that #bitcoin Only $100,000 was lost from buying off politicians and building relationships with the government. Without the requisite government intervention, this milestone would never have been effected. What could not be done in the free market was achieved through the unifying power of the state.
– Peter Schiff (@PeterSchiff) 5 December 2024
“It’s ironic that buying off politicians and building relationships with the government only got #Bitcoin to $100k,” Schiff said.
As an economist, Schiff worries that the government-backed momentum on alpha crypto could lead the US toward an economic bubble.
He said that Bitcoin could not have reached $100,000 per coin without government influence.
“Without the requisite government intervention, this milestone would never have been achieved. What could not be done in the free market was achieved through the unifying power of the state,” he explained.
Criticism of the proposed Bitcoin reserve
Schiff criticized the proposal to establish a national Bitcoin reserve, arguing that purchasing large amounts of BTC could destabilize the dollar.
America’s newly elected President Donald Trump is proposing its construction. bitcoin reserve Schiff said this is a proposal that would require the US government to purchase large amounts of crypto every year. He predicted that the US could have 1 million Bitcoins.
Financial commentators said the US could be pushed to sell its gold reserves to finance purchases of Bitcoin to increase its reserves.
He warned that this could lead to a financial crisis as it could give the impression that BTC is more viable than the US dollar, adding that this would reduce the global dominance of the US dollar as investors would lose confidence in the currency.
Featured image from Pexels, chart from TradingView
