Bitcoin’s recent period of stability following its halving has sparked negative comments from well-known cryptocurrency critic Peter Schiff.
Schiff, a skeptic of Bitcoin (BTC), has cast doubt on the value proposition supporting the demand for spot BTC ETFs, going against expert forecasts and recent market performance. Despite BTC’s impressive 55% year-to-date growth, Schiff pointed out that the cryptocurrency has been trading sideways for more than three months, resulting in minimal gains for investors in spot Bitcoin ETFs.
Spot exchange-traded funds monitor the price of an underlying asset, in this case, BTC, with profits linked to changes in the cryptocurrency’s price.
Schiff’s observations about BTC’s horizontal price movements may be accurate, but they may lack context. Bitcoin has surged by almost 70% since the approval of spot BTC ETFs by the U.S. Securities and Exchange Commission (SEC).
Moreover, BTC’s consolidation period lasting several weeks post-halving is not uncommon. In previous cycles, the asset has shifted from an accumulation phase to a parabolic rise.
BlackRock and Fidelity recently launched spot BTC ETFs that received an overwhelmingly positive response on Wall Street, amassing over $10 billion in assets under management within weeks. Despite this strong demand, Schiff remains critical of Bitcoin’s bullish outlook and price trajectory, questioning who has been selling BTC if ETF investors have been buying.
On the flip side, data from centralized exchanges indicate that Bitcoin balances are at a four-year low, suggesting that holders are holding onto their positions rather than selling, a practice known as “hodling” in the digital asset realm.
While Schiff speculates that ETF investors might grow impatient and sell off their shares during the consolidation phase, the increasing institutional interest in Bitcoin paints a different picture. Entities like the Wisconsin Investment Board have invested hundreds of millions in spot BTC ETFs, likely with a long-term perspective given the cryptocurrency’s historical growth.
With BTC surging by over 145% in the past year, outperforming traditional investments like the S&P 500, the case for investing in the leading cryptocurrency is strong. Over 80% of BTC buyers are currently in profit, according to data from IntoTheBlock.
Experts like Eric Balchunas believe that major institutions have yet to fully embrace spot BTC ETFs, despite the market’s current size of over $40 billion and its continuous growth. As global crypto adoption accelerates and forecasts predict the ETF market to nearly triple in size by 2035, Bitcoin’s bullish outlook remains robust.