Imagine Bitcoin backing your next loan. Isn’t that a mind-perplexing concept? Meanwhile, that is what Schiff Gold Chair Peter Schiff and financial expert Anthony Pompliano sat to discuss during one of the episodes in Pompliano’s business program.
Bitcoin’s Future
Can you use Bitcoin to pay for your new home? Schiff believed volatility remains a concern for most individuals. Nevertheless, Pompliano highlighted two aspects that might make it possible – a liquid market and BTC divisibility into satoshis.
Schiff compared Bitcoin-funded bank loans to utilizing stocks as collateral. Nonetheless, he emphasized his trust in selling individual small shares like BTC. However, Schiff highlighted the risks of individuals missing their margin call because of the Bitcoin price drop.
He also showed worry about banks liquidating clients’ BTC within such cases, translating to market falls. He stated that loaning against BTC can be inherently riskier than stocks-loaning since BTC is highly volatile than stocks. That means BTC can see massive price moves anytime.
As anticipated, Schiff was not that bullish on the volcano bonds idea by El Salvador. Keep in mind that Lyn Alden, a macroeconomist, called the plan “Michael Saylor’s playbook for a nation.”
As earlier reports show, crypto exchanges noted 39,000 BTC inflows. However, Bitcoin dropped by 13.6% within the past day, wavering at $48,509 at this publication. Market players wonder whether to use this as a chance to buy the dip or stay in wait mode. However, two top players in the crypto space made their move.
One is El Salvador’s president, claiming that the nation bought the dip, adding its BTC holding with 150 coins. On the same, Nayib Bukele challenged Justin Sun, Tron founder, telling hit to amplify his game. It seems like competition will emerge soon.
Though slow, banks appear to show interest in cryptocurrencies. A move to introduce BTC-backed loans by banks is a lucrative development in the crypto space as it will trigger price upsurges. However, that might not happen anytime soon with the regulatory and volatility concerns that have weighed down crypto mainstream acceptance.
Stay around for the latest updates in the crypto space.
