Bitcoin’s Potential Crash to $20,000: Peter Schiff’s Prediction

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Bitcoin’s Potential Crash to $20,000: Peter Schiff’s Prediction

Bitcoin and Nasdaq: A Tied Fate

Veteran investor and Bitcoin skeptic, Peter Schiff, has warned that Bitcoin may be in for a rough ride if the Nasdaq enters bear territory. The prices of Bitcoin often mirror movements in US technology stocks and the Nasdaq.

Schiff’s Forecast: Bitcoin’s Possible Drop

  • With the Nasdaq already down 12%, Schiff noted that further market corrections could heavily impact Bitcoin prices.
  • He tweeted, “If the Nasdaq is down 20%, Bitcoin will be around $65K.”
  • Schiff recalled past market crashes, mentioning significant Nasdaq declines: “After the Dot-com bubble burst, it fell nearly 80%. During the 2008 financial crisis, it dropped 55%, and in the 2020 COVID crash, it fell about 30%.”
  • He proposed that a 40% index drop could push Bitcoin towards or below $20,000.

Threat to Bitcoin’s Current Success

Even though Bitcoin is currently performing well, thanks to spot Bitcoin ETF investments and growing mainstream acceptance, Schiff believes a stock market downturn could prompt widespread selling, influencing Bitcoin prices. “Such a drop would hasten Bitcoin’s collapse to much lower levels,” he advised.

Gold vs. Nasdaq: An Opposing Relationship

  • Schiff pointed out gold’s inverse relationship with the Nasdaq, saying, “Since the Nasdaq peaked on December 16, 2023, gold has risen 13%, almost a perfect 1-to-1 inverse correlation.”
  • He predicts gold could reach over $3,800 per ounce if stocks decline and the dollar weakens.

Challenging Bitcoin’s Value Storage Status

Additionally, Schiff suggests this situation could question Bitcoin’s status as a value store. “Given this divergence would likely shatter the idea that Bitcoin is similar to gold, there would be no reason for the US government or any state government to hold Bitcoin in a Strategic Reserve,” he stated.

Peter Schiff’s Complete Statement on X

“The NASDAQ is down 12%. If this correction turns into a bear market, and the correlation where a 12% decline in the NASDAQ equals a 24% decline in Bitcoin holds, when the NASDAQ is down 20%, Bitcoin will be around $65K…” [full text]

(Disclaimer: The views and recommendations expressed by experts are their own and do not reflect the views of The Times of India)