Peter Schiff criticises Bitcoin as an unreliable inflation hedge, arguing it mirrors tech stocks rather than a safe asset. He calls for a focus on gold for economic uncertainty, while Senator Lummis supports Bitcoin, claiming it could mitigate the U.S. debt crisis. Meanwhile, MicroStrategy remains loyal to Bitcoin amid financial losses, and market data shows increasing confidence among long-term holders. The ongoing debate on whether Bitcoin is a hedge or mere hype continues.
Peter Schiff, a long-time advocate for gold, has once again challenged Bitcoin’s status as an inflation hedge. Despite a notable 14% surge in Bitcoin’s price recently, Schiff argues that it behaves more like a technology stock rather than a stable store of value. He pointed out, “Bitcoin has not decoupled from the NASDAQ,” emphasising that investors should consider gold for long-term financial protection. The fluctuations of Bitcoin make it a less dependable option during times of economic uncertainty.
In contrast, Senator Cynthia Lummis has voiced her support for Bitcoin. She recently endorsed the BITCOIN Act, asserting that Bitcoin could play a significant role in tackling the staggering U.S. national debt crisis, which has surpassed $36 trillion. This is quite a shift from Schiff’s cautious stance on digital currency and highlights the divide in opinions among financial leaders regarding cryptocurrency’s value.
MicroStrategy is also standing firm on its commitment to Bitcoin, even amid its financial struggles. The company reported a loss of $16.49 per share in the first quarter of 2025, largely attributed to a $5.9 billion Bitcoin writedown. Not deterred, Michael Saylor, the firm’s CEO, revealed plans to acquire an additional $84 billion worth of Bitcoin, expressing confidence in its lasting value despite the market’s volatilities.
Market dynamics have also been supportive of Bitcoin’s recent performance. April’s inflation report revealed a decrease to 2.3%, generating optimism about potential interest rate cuts. The call for a more lenient monetary policy was amplified when Donald Trump urged the Federal Reserve to ease up on rates, thereby creating a favourable backdrop for Bitcoin growth.
According to Fidelity’s Jurrien Timmer, Bitcoin can function both as “hard money” and as a “risk asset.” Although gold currently offers better risk-adjusted returns, Timmer believes that Bitcoin can still be a lucrative investment, especially if liquidity conditions improve in the broader market.
Data analysis from Glassnode shows that long-term holders have significantly increased their Bitcoin holdings by 254,000 units, indicating a strong confidence in the market. However, analysts caution that as Bitcoin approaches the $99,900 mark, selling pressure could become a reality, creating tension for short-term traders.
The question remains: is Bitcoin a hedge against inflation or just another speculative asset? The ongoing debate continues to stir strong opinions across the financial landscape, particularly between proponents like Schiff and supporters of digital currencies like Lummis.
Also Read: Peter Schiff Slams Bitcoin—Again—Says Strategy Will ‘Go Bankrupt’
