Economist Peter Schiff challenged the coin version of the claim that Bitcoin serves as an effective hedge against the weakness of the dollar. The dollar index is below 96.5, and Schiff urged him to warn about potential consumer prices rise in 2026 without immediate Federal Reserve intervention.
Schiff argues that gold, not bitcoin, will benefit from continuing dollar weakness based on historical correlations and market behavior. He argues that Bitcoin maintains a negative correlation with gold and undermines its effectiveness as a traditional, safe hull asset during the currency collapse period.
Economists suggest that selling risk assets during the dollar’s weakening could have a negative impact on Bitcoin prices. This view contrasts with cryptocurrency proponents who positions Bitcoin as digital gold and a valuable repository that is independent of the traditional financial system.
Your logic is flawed. Weak dollars make gold much higher. Bitcoin is negatively correlated with gold. It also has the possibility of selling on other risky assets, which has a negative impact on Bitcoin.
– Peter Schiff (@peterschiff) July 1, 2025
Fed policy creates a story of competing investments
Schiff has criticised both parties for its fiscal and monetary policy approach, which could exacerbate the weakness of the dollar. He argues that in order to reduce government funding costs, Trump specifically targets Trump’s preferences to reduce government funding costs, and that cuts in spending will address more effectively the underlying issues.
Economists argue that buying Bitcoin will increase pressure on the dollar rather than provide relief. His June 29 post claimed that “selling dollars to buy Bitcoin is putting pressure on the dollar,” and that investment in Bitcoin refers to the country as a waste of money that is harmful.
Coin Edition’s response cited the limited distribution and decentralization of Bitcoin as an advantage over Fiat currency printed and managed by central banks. They also argued that increasing the volatility of Fiat currency is the advantage of Bitcoin’s ultimate value proposition as “sound money” beyond central bank control.
Schiff’s claim that gold earns better profits in a weak dollar cycle is supported by historical precedent. Schiff does not provide a detailed analysis of other assets that are expected to be positively affected by weaknesses in dollars other than precious metals. This controversy highlights the fundamental differences in asset correlation during currency stress.
Traditional economists such as Schiff have turned to historical examples of gold’s behavior under the weakness of the dollar, while cryptocurrency proponents refer to the financial characteristics of Bitcoin. The decline in the dollar index offers an opportunity for both gold and bitcoin supporters to observe real-world behavior under the weakening of their currency.
Related: The worst year of the US dollar since 1973 will be the catalyst for the rise of Bitcoin
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