While Musk said Schiff "might as well" have crypto in lieu of gold deposit statements, he did warn that digital currency valuations may be running hot
While his electric car company announced a Bitcoin purchase weeks ago, Elon Musk finally became a true Bitcoiner last night by engaging in a time-honored cryptoTwitter pastime: dunking on Peter Schiff.
Yesterday morning Schiff, the noted gold bug and Bitcoin skeptic, posted a Tweet thread in which he criticized Elon Musk’s comment that Bitcoin is a flawed currency, though still better than fiat alternatives:
According to @elonmusk "Bitcoin is almost as BS as fiat money." So Musk regards both #Bitcoin and fiat as BS. I agree, I just think Bitcoin, which is digital fiat, is even more BS than the paper fiat issued by central banks. #Gold is not BS. It's real money and better than both!— Peter Schiff (@PeterSchiff) February 19, 2021
Schiff noted that, “as an engineer” the Tesla founder should know the difference between a “tangible element” and a “string of numbers,” and said that gold has greater utility relative to Bitcoin.
“Money isn't data. Data can represent money but can't replace it. Money improved barter, gold improved money, and data improved #gold. Bitcoin is a return to barter. All sellers will accept money. With #Bitcoin you must find a seller who has what you want and wants what you have,” Schiff concluded.
In response, the Tesla founder criticized Schiff’s view of third-party gold storage as an additional layer of trust, saying he “might as well have crypto.”
An email saying you have gold is not the same as having gold. You might as well have crypto.— Elon Musk (@elonmusk) February 20, 2021
Money is just data that allows us to avoid the inconvenience of barter.
That data, like all data, is subject to latency & error. The system will evolve to that which minimizes both.
Considering how flippant Musk has been in promoting the Dogecoin meme currency, he also hedged his statement with a perhaps surprising follow-up, warning that prices for Bitcoin and Ether are “high.”
While tempered, the Twitter statements are just the latest vote of confidence the world’s richest man has put into cryptocurrencies. Earlier this month Tesla used 7.7% of gross cash on hand to purchase Bitcoin, a sum worth $1.5 billion, and later followed up by saying “only a fool” wouldn’t seek investments beyond fiat.
Schiff, meanwhile, continues to be a punching bag so universal that even shawarma restaurants get in on the fun. While he’s recently admitted that Bitcoin isn’t the scam he once accused it of being, he remains resolutely in favor of physical bullion as an investment. His Twitter trash-talking carries on even as his bank remains under investigation.