With Peter Schiff sounding the alarm over an impending market meltdown, investors are posing a difficult question: if the stocks crash, what happens to Bitcoin? Will Bitcoin Crash?
Most envisioned Bitcoin as a safe haven, a digital gold. But here is what history has shown us. In March 2020, during the COVID-19 crash, Bitcoin and Ethereum lost close to 47% each, basically the same as the big stock indexes. The lesson? In panic, crypto isn’t left behind. It crashes too.
Despite growing popularity within the mainstream, Bitcoin is commonly regarded as a speculative, high-risk investment. In panics, investors liquidate riskier assets and move into cash or safe assets of worth. Crypto, as much value as it promises, doesn’t really have that niche yet.
Some believe Bitcoin will break away from stocks in the longer run. But if the market collapses before the Fed lowers the rates, crypto could be in trouble. The Fed has yet to act, and that is why this argument is more vulnerable. Without rate cuts as a backstop to markets, the damage could be deep and far-reaching.
Not all are worried, though. Writer Robert Kiyosaki recently said he wants Bitcoin to crash so he can purchase even more. He believes it’ll ultimately reach $1 million, calling it the “people’s money.” That’s a long-term bet, though, and not a short-term hedge.
Bitcoin can recover, even thrive in the long term. But in a crash, it falls with the rest. Players who wagered on crypto holding out as stocks plummet might be in for a nasty surprise once again.
We’re advised by experts to just keep calm and only put in what you can lose. Since if Schiff’s prophecy materializes, volatility can hit every corner of the market cryptocurrencies included.
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Could Bitcoin Crash Again if the Market Falls? Says Peter Schiff
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