In a recent interview with Anthony Pompilano, the two men discussed several topics, including the macroeconomy, assets to protect, and the debt ceiling. However, Schiff’s take on the commercialization of crypto-currencies was particularly interesting.
When asked about the “harmful actions” that hurt investors, Peter Schiff was quick to point out that the easy money, casino-like environment of crypto-currencies encouraged fraud and get-rich-quick schemes.
In addition, Peter Schiff says that this problem “feeds on itself“to the extent that crypto investors who make money are seen by others who experience FOMO, perpetuating a cycle of contagion.
“Crypto, I think, was almost a perfect asset for this. It had a really sexy history. When I first heard the story, I understood money too well to get on board.”
The strategy was a huge success for early investors, Schiff conceded, but it still relied on “the marketing of this pyramid, this Ponzi scheme, this chain letter; however you want to describe it.“
Peter Schiff went on to castigate central banks and their quantitative easing policies, which have encouraged a glut of cheap borrowing, further fueling the cycle.
The role of celebrities
Turning his attention to celebrities, artists, sports stars and influencers, Peter Schiff said that crypto-currency companies tempt them by offering sh*tcoins in exchange for promotion to their followers.
Throwing out Kevin O’Leary’s example, Peter Schiff stated that the Canadian entrepreneur used to be a fierce critic of bitcoin and crypto-currencies. However, O’Leary became pro-crypto after accepting a sponsorship deal from FTX.
“Kevin O’Leary changed his mind only because he was paid to change his mind. He became a spokesman for a crypto-currency company. He was negative about Bittcoin until someone paid him to be positive about it. So he sold out.”
Peter Schiff said the same thing happened with Mark Cuban, who was previously skeptical of bitcoin, until “he got into NFTs and suddenly had laser eyes, whatever.“
There was so much money at the top of that bubble, but that bubble has now burst,” said Peter Schiff.