AI Is Not Bullish for Bitcoin

Schiff: AI Is Not Bullish for <a href="https://xpertsstudio.com/bitcoin-ethereum-rally-20-is-the-crypto-bear-market-over/” title=”Bitcoin, Ethereum Rally 20%+ — Is the Crypto Bear Market Over?”>Bitcoin

Peter Schiff hasarguedthat the rise of artificial intelligence is not a bullish development for Bitcoin, pushing back against attempts to link the cryptocurrency to the booming AI sector.

In an Aug. 23 post on X, Schiff said Bitcoin advocates were trying to associate the asset with AI in the hope that investors would treat Bitcoin as part of the broader AI investment theme.

“Bitcoin pumpers are trying to hitch Bitcoin to the AI wagon, hoping investors will see it as part of the AI trade,” Schiff wrote. “They have it backwards. AI isn’t bullish for Bitcoin; it’s a threat to it.”

First, he believes the two sectors are competing for speculative investment capital. AI has become one of the biggest themes in financial markets. He also pointed to competition for electricity and data-center infrastructure.

The most significant part of his argument, however, concerns Bitcoin’s security. Schiff believes advanced systems could potentially identify weaknesses in Bitcoin’s software or cryptographic infrastructure that have not been discovered by humans.

“Plus, as AI becomes more powerful, it could discover vulnerabilities in Bitcoin’s code, cryptography, wallets, or network that humans have missed,” Schiff wrote.

He argued that this matters because Bitcoin’s security and limited supply ultimately depend on software and cryptographic mechanisms continuing to function as intended.

Schiff did not provide evidence that AI has currently discovered such a vulnerability in Bitcoin.

Schiff blasts Bitcoin as a “scam”

Earlier on Aug. 23, he wrote that “AI is not a scam, but Bitcoin is,” while also dismissing criticism of his longstanding position on the cryptocurrency.

Schiff has repeatedly argued that Bitcoin holders would have been better off selling the asset and buying precious metals instead. Responding to a post about Bitcoin’s historical gains, he wrote: “Yes, I could have made a lot of money with Bitcoin. But that’s old news. Over the last five years or so I’ve been better off not owning Bitcoin. It’s the Bitcoin HODLers who have left a lot of money on the table by not selling!”

His comments have also focused on inflation. On Aug. 21, Schiff said he did not view Bitcoin as an inflation hedge and argued that investors should choose gold or silver instead.

“I don’t think Bitcoin is an inflation hedge,” he wrote. “But I noted that other people think it is. They are wrong.”

Schiff similarly dismissed Bitcoin’s recent rally, arguing that inflation expectations and easier monetary conditions would benefit precious metals more than the cryptocurrency. On Aug. 20, after Bitcoin moved above $72,000, he described the move as “a fakeout, not a breakout” and urged investors to “Sell Bitcoin, buy gold.”

Source: cryptonews.net