Exclusive Interview: Peter Schiff Compares Bitcoin to Cigarettes, Claims BTC Lacks “Real Value”

American economist and well-known gold advocate Peter Schiff expressed strong criticism of Bitcoin (BTC) during an exclusive interview at the Binance Blockchain Week 2025 in Dubai. This annual event attracted hundreds of thousands of participants from across the globe.

Key Takeaways

Peter Schiff remains critical of Bitcoin, arguing it is destined to fail.
He believes that Bitcoin lacks intrinsic value and can't serve as a reliable store of value.
Schiff compares Bitcoin to cigarettes, claiming its value is based on perception rather than substance.
He emphasizes that gold has enduring value due to its historical and practical uses.

Peter Schiff Interview at Binance Blockchain Week 2025

Schiff was a key speaker in the much-anticipated gold versus Bitcoin debate alongside Binance founder Changpeng Zhao (CZ). While Schiff remains one of crypto's most outspoken skeptics, he plans to introduce a tokenized gold payment system that aims to modernize the use of physical gold in financial transactions.

Before his presentation, Schiff took the time to speak with Cryptonews, explaining his belief that Bitcoin's future is bleak and that tokenized gold is the way forward for reliable money.

Why Is Peter Schiff Bearish on Bitcoin?

Cryptonews: What makes you skeptical about Bitcoin?

Peter Schiff: I don’t think Bitcoin will succeed. Although there have been moments when I thought its price would rise, that’s different from my overall understanding of Bitcoin's true nature and long-term price trends.

The value of Bitcoin is influenced by people’s willingness to gamble on it. There can be times when demand rises but supply remains static, leading to price increases. We've certainly seen significant price rises for BTC over the years.

Interestingly, Bitcoin reached its peak at the same time as gold. If Bitcoin is presented as a digital form of gold, it would make sense to compare its price to that of gold. However, Bitcoin is currently priced much lower compared to gold's value from four years ago.

If I were a Bitcoin enthusiast, I would question this entire narrative. Why is Bitcoin still less valuable compared to gold four years ago, despite all the excitement around Bitcoin ETFs, treasury firms holding Bitcoin, and the election of a pro-Bitcoin U.S. president?

So, again, why is Bitcoin’s current value lower than it was four years ago? If it can’t rise now, what hope is there for appreciation in the future?

The Limitations of Bitcoin as Money

CN: Are there additional reasons you believe Bitcoin is not a viable currency?

PS: Bitcoin fails as money because it lacks intrinsic value. For something to function as a store of value, it must have worth. Although Bitcoin has a market price, you cannot "store" that price.

Bitcoin's price is only determined by market dynamics; thus, its future worth remains unpredictable. It relies entirely on the balance of buyers and sellers.

Even if you purchased Bitcoin at a low price years ago, selling it for a higher price doesn’t qualify it as a genuine store of value.

Understanding “Store of Value”

CN: How do you define a "store of value"?

PS: Gold serves as a store of value. For instance, my watch contains gold. At around $4,000 per ounce, there’s about $20,000 worth of gold in it. This means the gold can be extracted and used, highlighting gold's status as a reliable store of value.

Moreover, gold's value remains stable over the years; it can be used for the same purposes today as it could be hundreds or thousands of years ago. Do you honestly believe gold will lose its intrinsic worth as a metal?

Gold maintains its value, whether it’s old or newly mined. The gold I extract today has the same value as gold that was mined a century ago—its worth is preserved.

Conversely, Bitcoin lacks real value due to its lack of practical application. There’s no significant demand for it, and no industrial use—in other words, Bitcoin doesn’t serve essential functions in product creation.

Many individuals seek to protect themselves from inflation by holding gold, using it as a hedge. However, no one adopts the same attitude towards Bitcoin; it lacks genuine end users.

How Does Peter Schiff View Bitcoin?

CN: How would you summarize your perspective on Bitcoin?

PS: I liken Bitcoin to cigarettes in the context of currency. Cigarettes can function as money because many people smoke, leading to their circulation. For example, after World War II, GIs used cigarettes as currency, and they also serve this function in prisons.

If someone is willing to accept cigarettes as a medium of exchange—even if they don’t smoke because they can trade them—this creates value. However, if no one is smoking, the cigarettes become worthless. That’s how I perceive Bitcoin.