Bitcoin shows signs of potential topping out as investors await a Federal Reserve interest rate change on September 17. Notable Bitcoin critic Peter Schiff shares his concerns about the cryptocurrency's future.
Peter Schiff's Critique and Views on Bitcoin
Over the weekend, Bitcoin (BTC) and the broader crypto market faced selling pressure despite a weekly increase of 4%. Schiff, a well-known Bitcoin skeptic, criticized the expected monetary policy pivot of the Fed. "The Fed is about to make a major policy mistake by cutting interest rates into rising inflation... Time to change horses HODLers," he stated in a tweet.
Traditional Assets Outperform Bitcoin
Schiff pointed out that traditional safe-haven assets like gold and silver are gaining strength, whereas Bitcoin seems to be losing momentum. He noted that the NASDAQ and S&P hit new record highs, while gold also broke previous levels. Bitcoin currently remains 15% below its 2021 peak, raising concerns.
Rate Cut Implications for Cryptocurrency
Goldman Sachs forecasts that the Fed will reduce rates three times in September, October, and December, which may bring rates down to 3-3.25%. Historically, digital assets like Bitcoin often bottom out before U.S. equities. However, in September, altcoins have shown stronger gains, suggesting an altcoin season may be underway. Market expert Ted Pillows noted that rate cuts usually create short-term bearish pressure on risk assets.
The market will keenly watch Bitcoin's response to the Fed's decision, as the rate cut cycle may establish the next significant trend in the cryptocurrency market.
