[ad_1]
Euro Pacific Capital CEO Peter Schiff is now training his guns on Grayscale Trust’s GBTC after validation of its regular anti-bitcoin rhetoric was interrupted by the resurgence of the crypto market. After rapidly dropping to around $ 16,500 on November 26, BTC quickly recovered before setting a new all-time high of $ 19,864 on November 30, 2020.
Schiff alleges conspiracy
Realizing that his long-standing rhetoric against BTC is not paying off, Schiff now accuses Grayscale of fueling the Bitcoin bubble through his paid ads on CNBC. Schiff claims the ads are aimed at “pumping bitcoin to investors.”
The CEO of Euro Pacific Capital then details how CNBC is supposed to be in collusion with pro-bitcoin analysts to help the digital asset cause. Explaining the plot, Schiff alleges that after receiving the payments for the ads, “CNBC then returns the favor by constantly featuring pro-Bitcoin guests on the air, who make price predictions pie in the sky.”
Moreover, Schiff, in his Twitter of December 1 thread, says CNBC is keeping “bitcoin skeptics out.” Despite the bold accusations, Schiff does not say whether he or a known critic has been denied airtime by this medium.
Still, continuing his allegations against Grayscale, Schiff asserts:
This constant one-sided pumping results in GBTC trading at a significant premium over its net asset value, allowing Grayscale to create new GBTC shares which it quickly sells into the market for instant profit.
According to Schiff, the proceeds from the sale of new shares are then used to “buy even more BTC in the market (as well) by putting further upward pressure on the price of bitcoin.” At the same time, the profit from the sale of Grayscale shares is then used to fund more advertisements, says Schiff.
GBTC speculators
Schiff, who seems to enjoy the bitcoiners’ attacks, insists that Grayscale’s’ pumping ‘of BTC will stop once “GBTC speculators want to get out and GBTC shares (then) trade at a discount.” According to this theory, when Grayscale stops issuing new shares, it means that the investment company will also stop buying the digital asset in the market.
Schiff assumes (perhaps naively) that Grayscale is the only big buyer in the market. Indeed, Grayscale has accumulated BTC over the past few months as institutional investor interest in BTC increases. Recently, a $ 5 billion investment fund manager, Guggenheim Macro Opportunities Fund, revealed plans to invest nearly $ 500 million in digital assets through GBTC.
Reducing the BTC supply and price
However, Schiff’s hypothesis appears to be belied by reports that other institutional investors and high net worth individuals are also buying BTC. According to Bitcointreausuries, a site that keeps track of state-owned companies holding bitcoin, more than 800,000 BTC or 4% of the total circulating supply is in the hands of state-owned companies. Many of these new holders are drawn to the digital asset’s status as a digital form of gold, a fact that infuriates Schiff.
Therefore, as more and more institutional investors add BTC to their cash reserves, it has the effect of reducing the circulating supply. This in turn adds upward pressure on the price of BTC, which is now expected to hit another all-time high in the coming months, if not weeks. It is clear that if this happens, Schiff will tweet more attacks against BTC and organizations that embrace digital asset. However, if BTC reverses most of the gains made in 2020, Schiff will be a justified man.
What do you think of Peter Schiff’s claims that Grayscale is helping fuel a Bitcoin bubble? Let us know what you think in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons, Gage Skidmore
[ad_2]
Source link