Peter Schiff, a prominent and vocal critic of Bitcoin, has unveiled a new, remarkably simple theory for its ultimate downfall, straying from the usual fears of quantum computing or government regulation. He argues that Bitcoin's Achilles' heel is not some external shock, but rather a far more fundamental and internal vulnerability: the collective loss of belief.
The Psychological Engine of Bitcoin's Value
Schiff conceptualizes the entire cryptocurrency market as a "psychological flywheel," where a growing base of believers fuels increased buying, driving up Bitcoin's price, which in turn attracts even more adherents. This self-sustaining loop, he contends, is Bitcoin's core mechanism for growth. However, this system is inherently fragile. Schiff predicts that the cycle will inevitably break when the price no longer rises swiftly enough to enlist fresh converts. As this vital stream of new belief dries up, early holders will begin to reconsider their positions, and late arrivals will succumb to panic, causing the entire structure to collapse under its own weight of diminishing faith.
An Internal Collapse, Not an External Threat
Crucially, Schiff dismisses fashionable narratives like the "quantum threat," which posits that advanced computing could someday compromise Bitcoin's cryptography. He believes such external apocalypses are irrelevant. Instead, he sees the "apocalypse" as already embedded within Bitcoin's "DNA"—a "self-referential demand engine" destined to fail the moment its audience becomes disengaged or bored. Despite long-standing criticisms of Schiff's past predictions regarding Bitcoin's value, his current argument carries a peculiar resonance: if Bitcoin's worth truly rests on a foundation of collective belief, then the only robust counter to his prophecy is the persistent and active choice of people to continue believing in it.
