Bitcoin Critic Peter Schiff: Crash of Weed Stocks Will Lead to Bitcoin Price Drop
- Bitcoin’s volatility is reportedly as less than 2%.
- There doesn’t appear to be any correlation between the performance of pot stocks and Bitcoin, despite Peter Schiff’s claims.
It is no secret that Peter Schiff isn’t quite a fan of Bitcoin, consistently voicing his happiness whenever the cryptocurrency drops. He takes every opportunity to highlight Bitcoin’s shortcoming, hoping that cryptocurrency enthusiasts end up following along and abandoning the asset. Now, he is working to compare with pot stocks to take down cryptocurrency.
Many of the speculators who were buying pot stocks were also buying #Bitcoin. With heavy losses in the former, perhaps they will look to realize some gains on the latter, or mitigate their losses before the bottom drops out of the crypto market too.
— Peter Schiff (@PeterSchiff) November 15, 2019
The CEO of Euro Pacific Capital believes that Bitcoin is going the same direction of pot stocks, adding that the rally pot stocks experienced was nothing more than a speculative move by investors. He also said that the same spectators of the pot stocks were buying up Bitcoin.
In the last few months, the rally for pot stocks ended, which can be seen in the drastic decline over the last six months that was recorded by the U.S. Marijuana Index.
Schiff sees the recent action of marijuana stocks as a precursor to the same fate of Bitcoin, as the speculators work to sell off what they have before Bitcoin falls too far. However, most crypto experts wouldn’t agree with Schiff’s statements, considering that there is little to support the connection between the performance of Bitcoin and pot stocks.
Realistically, as CCN points out, there’s no correction between the asset classes, and research proves that one doesn’t rely on the other.
#Bitcoin is often described as an uncorrelated asset, thus a suitable hedge against risks in traditional financial markets. But is really? I've taken a look at daily returns of Bitcoin, several stock markets and Gold and the answer seems obvious: It is. Gold as well, by the way. pic.twitter.com/DSk3UJFtE4
— Michele D'Oro (@keledoro) November 9, 2019
In fact, experts used to believe that Bitcoin could thrive when the stock market simply was incapable of doing so or was under stress. Bitcoin has consistently been regarded as “digital gold” by many, though some experts were so bold as to suggest that the digital asset could replace gold.
The connection between the stock market and bitcoin can’t be proven, and Schiff almost forces these seams together in a way that just won’t fit.
More interestingly, the assumption that the same spectators are purchasing Bitcoin and pot stocks isn’t justified. BitMex reports that the daily volatility of the former is less than 2% right now, which will hopefully be an encouraging fact for institutional investors to get involved with cryptocurrency. This migration seems to already be happening.
Very doubt that pension funds and insurance companies are holders of BTC futures. The regulations are not that simple preventing them from investing in even some traditional alternative assets, and here we talk about Bitcoin🤔 Mostly they are HFs and alternative assets managers.
— AS Exchange (@exchange_as) October 22, 2019
Wall Street hasn’t been standing with pot stock in the same way at all. While the efforts to legalize marijuana reaches a major halt, the bubble seems to have burst. However, Bitcoin is much different, as it doesn’t need approval by the government, being entirely decentralized. Bitcoin is a medium of exchange, while marijuana just isn’t.