It’s hard to be a bitcoin (BTC) bull these days. The latest price of Bitcoin was below $20,000 and two recent attempts to restore the $25,000 level have failed.
To recover its highs around $68,000, Bitcoin needs to double in price and then gain another 70% after that. On the other hand, Bitcoin needs to lose about $9,000 more to reach the very worrying $10,000 level.
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I hate to say it, but everyone’s favorite (or least favorite) bitcoin bear Peter Schiff is winning the debate. Consider our previous article on Peter Schiff, which you can read on our website. In mid-August, Schiff used technical analysis to argue that the rally that pushed Bitcoin to the $24,000 level was fake.
Fair warning: Schiff is on the losing side when he confronts holders who bought bitcoin years ago. But since 40% (probably now much more) of bitcoin investors are underwater, this article focuses on short-term price action.
Bitcoin Catalysts That Are Nothing Like This
Invezz previously reported in September 2021 how Schiff argued that the introduction of cryptocurrencies would drive up consumer prices. Two months earlier, another article contained Schiff’s comments that bitcoin was doomed to maintain the $30,000 level.
However, Schiff is raking in a lot of Ws – at least for those with very short schedules.
The latest bitcoin news is full of what appears to be bullish catalysts that prove Schiff’s bearish stance wrong. For example, Forbes describes BlackRock’s new private bitcoin trust (BLK) as a “game changer” that opens up access to BlackRock’s $10 trillion worth of bitcoin.
Fidelity, Citadel and Charles Schwab also announced the launch of a bitcoin and cryptocurrency exchange called EDX Markets (EDXM).
The press release quoted EDXM’s board of directors as saying that the crypto market is “a $1 trillion global asset class with over 300 million members and pent-up demand of millions.”
Any of these developments alone should convince anyone sitting on the sidelines that now is the time to buy Bitcoin. But no. The price of bitcoin has failed to gain momentum, proving that what appears to be an encouraging and bullish development is anything but.
So what needs to be done to support a higher bitcoin price? BlackRock is the world’s largest asset manager, and Citadel considers itself “the Amazon of the financial markets.”
I can’t imagine more significant catalysts that will push Bitcoin to its highs. In other words, Schiff’s victory dance (assuming he chooses it) will continue for some time, if not indefinitely.
But what about El Salvador?
El Salvador’s experience with bitcoin as legal tender has crossed the one year mark and can be said to have been successful. Part of President Naib Bukele’s initial speech to the global financial community was, “Invest here and make as much money as you want.”
As a reminder, Bitcoin was trading at about $47,000 at the time. There is no need to indicate its current price.
Reuters recently covered a study by the National Bureau of Economic Research (NBER) that found that only 20% of the population downloaded the Chivo crypto wallet shortly after it was offered to the public with free $30 credit. Fast forward to 2022 and “there were almost no downloads.”
The report also states that the local population does not understand or “trust” bitcoin. This adds extreme volatility and high fees to the coin. Given El Salvador’s status as a Third World country, creating additional economic hardship for its population through bitcoin is certainly a setback.
Our data analyst Dan Ashmore traveled to El Salvador to see bitcoin first hand. You can read his excellent article here, but his observations more or less agree with the NBER report.
And he says:
Bitcoin is a complex concept that takes time to understand. In El Salvador, it was declared legal tender overnight without warning people, it was announced at the Miami Bitcoin Conference. The lack of information from people and the lack of sufficient education to inform people on how to use it and what benefits it can bring has hurt the whole project so far.
But who was right about bitcoin in El Salvador from day one? As you may have guessed, everyone’s favorite (or least favorite) bitcoin bear. Schiff said on RT shortly after bitcoin became legal tender:
El Salvador is in big trouble. They need a dose of free market capitalism. They need massive deregulation, they need less government. They need to give free rein to the entrepreneurial spirit of this country. And instead of accepting bitcoin, they should embrace capitalism. This is the way out of this mess.
I don’t want Peter Schiff to be right, but he’s not wrong.
I have nothing against Peter Schiff, he seems to be very knowledgeable and educated about bitcoin and the crypto market. Much of the hatred directed at him stems from the petty partisanship of the Bitcoin brothers, who will not tolerate outside opinion.
I have skin in the game, so it’s in my financial interest to see Schiff wrong. I mainly deal with bitcoin through a bitcoin mining company called BitFarms, which is traded on the Toronto Stock Exchange and Nasdaq.
Like the digital coin, stocks are failing, down 75% since the start of 2022, with no relief in sight.
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