Bitcoin Could Plummet 60% If NASDAQ Enters Bear Market, Warns Economist

Economist Peter Schiff has issued a stark warning about the potential for a significant crash in the Bitcoin market. Schiff predicts that if the NASDAQ enters a bear market, the price of Bitcoin could plummet to as low as $20,000. This prediction comes amid a period of market turbulence, with the NASDAQ Composite index declining by over 8.21% and the NASDAQ 100 index by 6.16% since the beginning of 2025. During the same period, the price of Bitcoin has decreased by approximately 11.25%.

Schiff's analysis is based on historical correlations between the NASDAQ and Bitcoin. He notes that a 12% decline in the NASDAQ has historically corresponded to a 24% decline in Bitcoin. If the NASDAQ were to fall by 20%, Schiff predicts that Bitcoin could drop to around $65,000. However, in a more severe bear market scenario, where the NASDAQ declines by 40%, Schiff warns that Bitcoin could crash to as low as $20,000.

Schiff's bearish outlook on Bitcoin is contrasted with his bullish stance on gold. He predicts that as investors seek safe-haven assets in response to market instability, the price of gold could surge to over $3,800 per ounce. This prediction is supported by the recent performance of the gold market, which has seen a rise of at least 15.1% since the start of the year. Schiff argues that gold's traditional role as a hedge against market uncertainty makes it a more reliable store of value than Bitcoin, especially in times of economic turmoil.

Schiff's warnings are not without precedent. He draws parallels between the current market conditions and previous US market crashes, such as the Global Financial Crisis of 2008 and the Dot-com bubble burst of 2000. In both instances, the NASDAQ experienced significant declines, and Schiff suggests that a similar scenario could unfold if the current market weakness persists. He also points out that institutional investors, including governments, ETFs, and corporate entities, may flee the Bitcoin market in favor of gold if the latter continues to outperform.

Schiff's prediction highlights the potential risks associated with investing in cryptocurrencies, particularly during periods of market volatility. While Bitcoin has defied pessimistic predictions in the past, Schiff remains firm in his belief that gold will outperform Bitcoin in the long run. His analysis underscores the importance of diversification in an investment portfolio, as it can help mitigate the risks associated with investing in a single asset class. By spreading investments across a range of asset classes, including stocks, bonds, and commodities, investors can better protect their portfolios against market volatility and economic uncertainty.

Ask Aime: Could the projected decline in Bitcoin prices be averted by gold's surge in value?