Economist and gold advocate Peter Schiff said Bitcoin’s recent flash crash was not a buying opportunity but a signal of deeper weakness in the cryptocurrency market.
“The Friday Bitcoin flash crash wasn’t a buying opportunity but a warning. The next time Bitcoin crashes, Trump may not be able to save it with a social media post,” Schiff wrote on X.
He added that gold’s recent price surge “is exposing the fiction that Bitcoin is digital gold,” warning that “the bottom can drop out of Bitcoin at any time.”
A Volatile Market Triggered by Tariff Threats
Schiff’s comments came after Bitcoin experienced a sharp drop on Friday, Oct. 10, briefly shaking investor confidence before recovering.
The crypto crash came shortly after President Donald Trump threatened new tariffs on imports from China, sparking a broader sell-off in riskier assets like tech stocks and cryptocurrencies.
CNN reported that, according to CoinGlass data, the downturn resulted in a record $19 billion in liquidated positions.
About 1.6 million traders were affected, with many caught in highly leveraged positions that were automatically closed.
“The aggressive crypto selloff was sparked by a risk-off stampede,” said Lukman Otunuga, senior market analyst at FXTM.
The Nasdaq Composite dropped 3.56%, the S&P 500 posted its worst day since April, and Bitcoin fell 15% at its lowest point, briefly dropping from around $122,500 to about $104,600.
Ethereum fell roughly 21%, and speculative coins like Dogecoin and $TRUMP saw losses over 50%.
The crash also triggered concerns about crypto platform reliability.
Binance reported that some assets briefly became de-pegged from the dollar due to technical issues during the volatility.
Schiff Says Gold Is Winning
Amid the chaos, Schiff argued that the flash crash highlighted gold’s growing strength compared with digital assets. “Gold just put a big hole in that boat,” Schiff said in response to one person who called Bitcoin a “lifeboat.”
When another person accused him of being afraid that Bitcoin could replace gold, Schiff replied, “It’s the reverse. Bitcoin pumpers are afraid of gold exposing Bitcoin for the fraud that it is.”
Warning To Bitcoin Investors
Asked why he continues to focus on Bitcoin despite being known as a gold advocate, Schiff said his concern is that “a lot of people are going to lose a lot of money in Bitcoin because they bought it instead of buying gold.”
Critics mocked Schiff’s stance, with one person saying, “I love how Bitcoin ruins your day every day,” while others dismissed his warnings as outdated.
Still, Schiff maintained that Bitcoin’s volatility and dependence on social media hype make it far riskier than traditional stores of value.
Bitcoin hovered around $115,000 on Monday, stabilizing after its Friday plunge but failing to recover its previous high of over $126,000 on Oct. 6.
“Friday’s move was a textbook example of how leverage can amplify short-term volatility in a 24/7 market,” said Samir Kerbage, CIO at crypto asset management firm Hashdex.
Despite the rebound, silver futures surged 7% and hit an all-time high Monday, suggesting continued investor unease.
Schiff’s warning underscores his long-standing view that gold remains a safer hedge against economic uncertainty, while Bitcoin’s appeal, in his view, is built on speculation that could collapse without public enthusiasm or political backing.
IMAGE CREDIT: “Peter Schiff” by Gage Skidmore, via Flickr. Licensed under CC BY-SA 2.0. Image adjusted for layout.