Gold bug and economist Peter Schiff has warned of deeper losses for spot bitcoin exchange-traded funds (ETFs), emphasizing that they are “now in bear markets.” Referencing the Proshares Bitcoin Strategy ETF which is down more than 50% in over two years, Schiff predicted that those who bought the newly approved spot bitcoin ETFs “will experience even worse results.”
Peter Schiff’s Spot Bitcoin ETF Outlook
Gold bug and crypto skeptic Peter Schiff expects deeper losses for the newly launched spot bitcoin exchange-traded funds (ETFs). He shared his outlook in several posts on social media platform X this week.
The price of bitcoin rose above $47K in anticipation of the spot bitcoin ETF approval by the U.S. Securities and Exchange Commission (SEC). However, BTC embarked on a downward trajectory following the approval, dropping below $40K on Monday and $39K on Tuesday. Schiff described on Monday:
All the spot bitcoin ETFs are now in bear markets, defined as a drop of 20% or more from the peak.
He added, “The biggest loser is FBTC [Fidelity Wise Origin Bitcoin Fund], down 32%.” In a follow-up post, he wrote: “The Proshares Bitcoin Strategy ETF, which tracks bitcoin futures, launched in Oct. 2021. BITO began trading at $40.88. So far today’s low was $19, down more than 50% in over two years. I think those who bought any of the 11 spot bitcoin ETFs will experience even worse results.” At the time of writing, BITO is trading at $19.04, down nearly 52% since inception.
After the price of bitcoin dropped below $39K on Tuesday, Schiff detailed on X: “The new bitcoin ETFs aren’t creating additional demand, but merely shifting demand. Investors who might have bought actual bitcoin, bitcoin-related equities like MSTR [Microstrategy stock], or GBTC [Grayscale’s bitcoin trust] are simply buying the new ETFs instead. Rearranging the deck chairs won’t stop the ship from sinking.”
Schiff added: “One of the biggest losers from the new bitcoin ETFs is COIN [Coinbase stock]. Even though Coinbase custodies bitcoin held in these ETFs, speculators who once traded bitcoin through Coinbase are now trading the ETFs instead. Also, many who bought COIN as a bitcoin proxy are now buying the ETFs.” On Monday, JPMorgan also downgraded Coinbase stock from Neutral to Underweight, with a price target of $80. At the time of writing, COIN is trading at $124.19.
Earlier this month, the economist warned that spot bitcoin ETFs will bring speculator selloff and minimal institutional demand. He also expects the chairman of the U.S. Securities and Exchange Commission (SEC), Gary Gensler, to introduce onerous crypto regulations that would sink the price of bitcoin.
What do you think about Peter Schiff’s spot bitcoin ETF warning? Let us know in the comments section below.
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