Century Debate Turns into BD Summit? Peter Schiff Confronts CZ: Can You List My Gold Token?

Source: Binance Blockchain Week

Translation: Ethan, Odaily Planet Daily

On December 4th, Dubai time, the debate between the "Gold Bug" Peter Schiff and Binance founder CZ, with the theme "Bitcoin vs. Tokenized Gold," officially kicked off on the main stage of Binance Blockchain Week at the Coca-Cola Arena.

This highly anticipated debate focused on the core disagreement between the two sides, addressing the "value essence of digital assets versus physically backed assets":

Peter Schiff:

· Bitcoin is a "digital tulip bubble," its value originating from the "collective fantasies of speculators," and its essence being that of a "pure speculative asset" whose price relies entirely on "greater fools buying in."

· "No one prices goods or pays wages in Bitcoin; merchants accepting Bitcoin immediately convert it to fiat currency." It cannot serve as a unit of account or a medium of exchange, lacking any practical use case.

· Bitcoin has "zero intrinsic value, relying solely on confidence," while tokenized gold is backed by physical assets, possessing scarcity and the convenience of blockchain, supporting physical redemption or token transfer.

CZ:

· Bitcoin is the "digital age gold 2.0," where declaring 1 kg of gold across borders is required, but Bitcoin can be transferred instantly via mobile phones. Gold's monetary function has long been replaced by fiat currency, whereas Bitcoin has addressed cross-border payment pain points (reducing African user payment time from 3 days to 3 minutes).

· With a total supply of 21 million coins, Bitcoin's supply is transparent, while gold reserves remain unknown and rely on third-party storage trust. Bitcoin already has hundreds of millions of users, a market capitalization of $2 trillion, a stable ecosystem, and is not a "Ponzi scheme."

· Gold prices also fluctuate (recently dropped by 10%), but Bitcoin achieves "seamless use" through products like Binance Card, surpassing gold in liquidity and convenience of payment.

It is worth noting that both sides do not hold completely opposing positions, acknowledging that tokenized gold "significantly enhances gold's liquidity." However, there is still a fundamental disagreement on whether "Bitcoin possesses core monetary attributes."

In fact, this clash had been foreshadowed. Previously, both individuals appeared on the podcast show CounterParty TV hosted by the crypto community broadcaster Threadguy, where they each explained their views on cryptocurrency and the future of decentralization. However, a single podcast exchange did not satisfy public expectations for this "battle of old and new assets." Schiff's appearance on stage was particularly confident, as he had been consistently criticizing Bitcoin on social media for the past two months: when Bitcoin fell below $90,000 in mid-November, the price of gold remained above $4,000, with gold and silver seeing year-to-date gains of 60% and 95%, respectively, by the end of November. Based on this, he has repeatedly declared the bankruptcy of the "digital gold" narrative and predicted that the "strong gold, weak coin" trend will continue until 2026.

Ultimately, this gunpowder-scented and entertaining debate concluded with "Agree to Disagree." Odaily Planet Daily tracked the full course of this explosive debate and compiled it as follows:

Peter Schiff's Gold Tokenization Project

CZ: First of all, Peter, thank you very much for being here. I somewhat consider myself half of the host, so at the beginning, I want to be civil. Let's see later if we "throw punches."

Thank you very much for taking the time to be here. I think it takes courage to stand on this stage in such a setting and in front of such an audience. To be honest, it's quite an advantage for me.

Peter Schiff (hereinafter referred to as Schiff): I actually have some supporters in the audience as well.

CZ: Of course, absolutely.

Schiff: Even though they disagree with me on the Bitcoin issue, they still support me on many other things. But I really appreciate you hosting this event and inviting me. At least you have the courage to face me. You know, all these years, I've been wanting to debate Michael Saylor, and he still hasn't dared to come. But you are completely fearless.

CZ: I can give him a call for you tonight.

Schiff: Let's see if he's still around.

CZ: I'd like to give you an opportunity to introduce yourself first. You are currently working on tokenization-related business, and in the future, you will actually launch a project to tokenize gold, right?

Schiff: The origin of this matter actually started when I talked about tokenized gold in a cryptocurrency podcast, and you happened to catch that episode. Yes, my website is called TGold.com. The "T" in the name stands for Tokenized Gold. Frankly, I was quite surprised that Tether didn't snatch up this domain name, but since no one used it, I registered it.

On TGold.com, you can now directly purchase physical gold and silver, which we will custody for you. All assets are held separately and in individual vaults, not commingled gold. This is truly allocated gold, not unallocated. So, you have full ownership of the gold, and it is indeed stored in a vault.

In addition to selling directly for USD, users in the future will have two ways to redeem their gold. The first is redemption in physical form, where you can choose any denomination of gold bar or coin. The other way is redemption in the form of a token. After redeeming as a token, you can store it in your own wallet or deposit it on a future exchange. The key point is that you can redeem the token at any time, and it represents your ownership of that portion of gold.

What you own is the actual gold held in the vault, and the token is proof of your ownership. It's like checking in your coat and receiving a coat check tag – the tag is not the coat itself, but it allows you to reclaim the coat. The principle of tokenized gold is exactly the same.

Because the token is divisible, you can transfer any portion of it to someone else, making them the new owner of that portion of gold. The gold itself does not move; it remains in the vault. However, ownership can be immediately transferred.

In this scenario, you can use the token as a medium of exchange. What you are transferring is ownership of the gold, not physically transporting the gold. This way, you are essentially reactivating the monetary properties of gold: it can be transferred, divided, and circulated, while still retaining its core underlying value, with the token corresponding to real, redeemable gold in the vault.

CZ: So, if I understand correctly, you mean that in terms of divisibility, transferability, portability, and as a medium of exchange, tokenized gold is actually better than physical gold, right?

Schiff: From a currency perspective, that is indeed the case. Of course, if you want to use gold for actual production, such as making jewelry, you still need to redeem the token for physical gold. Or if you are in chip manufacturing and need gold material, you must also redeem it.

But if you are using gold as a currency, then yes, tokenization has indeed improved its properties. This is similar to practices from hundreds of years ago. Back then, people would deposit gold at a blacksmith's shop, and the blacksmith would issue an IOU, which would later circulate directly in the market because it was more convenient to carry than gold itself. When governments started issuing paper currency, they were accepted because they were backed by gold.

Thus, commercial transactions were no longer settled directly in gold but in paper currency. Yet the value of the paper currency came from gold. And today's fiat currency is no longer backed by any assets; it relies solely on people's trust. Tokenized gold brings this mechanism into the digital world: I no longer hold a piece of paper but a digital certificate. I don't need to hand you a paper face to face; I can transfer ownership online.

This is also why I often say that Bitcoin is fundamentally more like fiat currency because it has no tangible backing. In contrast, tokenized gold is "asset-backed," deriving its value from the underlying physical gold. The value of Bitcoin instead relies entirely on market confidence—if people believe in it, they will buy.

CZ: We will delve deeper into Bitcoin shortly. Yes, I just want to confirm first: in many use cases, tokenized gold may indeed be more practical than physical gold. Once tokenized on the blockchain, it becomes not only transferable and divisible but also more usable. Of course, all of this is based on the premise that it is indeed backed by real gold.

Schiff: Yes, that's the point. It makes gold more user-friendly, similar to how paper currency made gold more usable in the past. Of course, later government intervention disrupted the monetary system, but that is a government issue, not a gold issue. Tokenizing gold through issuance does not require government involvement. Any reputable private institution can tokenize gold without official endorsement, and people can still use it as currency. Even if there are tokens issued by different institutions on the market, they are still fungible because they all represent gold and are fundamentally the same.

CZ's "Physical Gold Bar" Challenge and Verification Difficulty

CZ: Since we are talking about gold, let's take a look at something physical. If possible, bring up that "mysterious box." It's quite heavy. Here is an exquisitely crafted box. The language here, I guess, should be Kyrgyz, brought back from Kyrgyzstan, with a national-level authentication document attached. I recently obtained it from a very important person locally, so I consider myself lucky. Let's open it and take a look. It's indeed heavy. It says "Kyrgyzstan" here, one kilogram of pure gold, purity of 999.9, and a corresponding serial number.

Schiff: Yes, indeed very heavy.

CZ: But is this gold bar real?

Schiff: Well, I can't be entirely sure either. Do you want me to authenticate it now?

CZ: Let's see how we can authenticate it.

Schiff: You see, this color... If it's pure gold, it should look like this. The bracelet on my wrist is also made of pure gold, but compared to this bar, the color seems slightly different. But to be honest, I can't conclusively determine with just my naked eye; perhaps it is indeed gold.

CZ: I can tell you, this was a gift from a very important person.

Schiff: I see. But I noticed that the name of the mint on it is unfamiliar to me. For gold, the key is the reputation of the mint. If you know which mint produced it, and you trust them, it's because they have to maintain their reputation. But the name on this piece is completely unknown to me, so strictly speaking, it should be sent for assay to confirm. However, in terms of color, it does indeed have some differences compared to my bracelet.

CZ: Maybe it's due to some special specifications or craftsmanship, I'm not sure either.

Schiff: Are you intending to give this to me?

CZ: Oh, you mean if I intend to give it as a gift to someone? Indeed, this is a nice "gift."

Schiff: I'm also not sure what you mean. If you are just giving it to me as a gift, and not as a gold asset for me... that's another matter.

CZ: So how much is it worth now? This whole piece.

Schiff: Gold is currently around over four thousand dollars per ounce. So I estimate this piece to be around fifty thousand dollars. I didn't calculate it carefully, but in terms of volume, this is indeed a large piece of gold.

CZ: AI tells me that this piece is worth approximately one hundred to one hundred thirty thousand dollars. Almost a hundred thirty thousand.

Schiff: Regardless, the price of gold is what it is.

CZ: It weighs one kilogram.

Schiff: One kilogram? How many ounces is that?

CZ: Thirty-two ounces.

Schiff: Well then. Look, I want to give you a little something. Since it's worth a hundred thirty thousand (dollars), I certainly won't give the whole piece away. I can give you a portion, but you can't split it, that was my point just now. You also can't just break off half and give it to me. At our company, we sell standardized products, like one-ounce gold coins. You can buy small denomination gold directly, and we only sell products from reputable mints. This way, you don't have to guess, or assay, you'll know it's genuine when you hold it, and you can also tell if it has been tampered with.

CZ: Actually, I really wanted to give it to you, but I'm concerned that you might not be able to take it out of the country, if you know what I mean.

Schiff: What? No one's going to stop me. I'll just put it in my bag, and no one will care.

CZ: Are you sure? In this country, the police will immediately come after you and take you away.

Schiff: Just because I'm carrying this piece of gold?

CZ: Exactly. It depends on whether you declare it, where the gold came from, and who sold it to you.

Schiff: What if I say you gave it to me?

CZ: That might cause even more trouble. This gold piece is indeed real; it was a gift from the President of Kyrgyzstan to me, so I certainly wouldn't give it away easily.

Schiff: I see. It seems like this item already holds sentimental value for you, so you're not too keen on giving it to me.

CZ: Especially after you mentioned "sentimental value." But let's talk about this later. The key point is, if I transfer some Bitcoin to you now, you can immediately verify the receipt. We have many ways to almost instantly confirm a successful transfer.

Schiff: Right, I understand that.

CZ: The same logic applies to tokenized assets. If you send it to someone else, they can almost instantly verify it as well.

Schiff: Yes, tokenized gold works the same way.

"Intangible" Virtual Assets vs "Timeless" Physical Gold

CZ: Now I want to respond to your earlier point about Bitcoin having "no backing." Let me ask you in a different way: Do you use an iPhone? I use an iPhone myself; you probably don't use an Android, right?

Schiff: I also use an iPhone.

CZ: So you are obviously using the internet as well. You use X, Google, Facebook, right? These are all virtual products. The internet itself seems like it has 'nothing'.

Schiff: Yes, it is intangible.

CZ: But X has value, Google even more so, right? So this 'virtual existence' of the internet itself has tremendous value.

Schiff: Right, I don't deny that.

CZ: In fact, Bitcoin itself does not exist. I don't know if the audience is aware of this: on the blockchain, there is no file called 'Bitcoin'. What truly exists is just a series of transaction records on the ledger. When you say 'I'm sending you a Bitcoin,' you actually haven't sent anything; you've just added a record to the ledger.

Schiff: Right, when you say 'send me a Bitcoin,' nothing actually moves. I fully understand this point.

CZ: Exactly. How much Bitcoin an address holds is calculated by viewing all its inputs and outputs and determining the balance. So Bitcoin doesn't have a fixed 'location.' But that doesn't mean that just because it's virtual, it has no value. Google has immense value, Twitter has immense value. Many virtual things are inherently valuable. And gold, despite its industrial uses, its industrial value is much lower than the market value we give it, because it is scarce.

Schiff: First, just because something is an intangible asset doesn't mean it has no value. I certainly understand that intangible assets can also be highly valuable, such as goodwill of a company.

But the key is, the 'intangibility' of Bitcoin is not the issue. The issue is: you can't do anything with Bitcoin. Its only utility is 'you can transfer it to someone else.' It has no utility.

Of course, the entire design of the Bitcoin system is very clever, I understand that. But when I transfer Bitcoin to you, I actually haven't given you anything. I don't have anything in my hand, and no entity is being transferred.

And when I transfer tokenized gold to you, what I'm transferring is ownership of a real asset. That ownership corresponds to gold in a vault that someone must physically deliver. What gives gold value is its utility.

Gold possesses physical and chemical properties that other metals do not have. Many industries must use gold and cannot substitute it with copper or other metals. Some technologies can only rely on gold, and the industry needs it now. Gold is scarce, has a limited supply, and can maintain high value solely based on supply and demand relationships.

Some people say, "Perhaps the true value of gold is not that high." Maybe, I can't say for sure either. But the price is always determined by supply and demand.

Gold also serves another purpose as a reserve asset for central banks, supporting currency issuance. This also affects the market price of gold because central banks need it and must purchase it from the market. Gold does not decay or perish.

That's right. When I own gold, what I have is not "what I can use it for today," but "the value of what others can use it for at any time in the future."

Gold from ten thousand years ago still exists today. It does not rot, disappear, or change in nature. The price of gold reflects the present value of all its uses from now to the future. Items that will decay or deplete cannot achieve this because they will eventually disappear.

But gold doesn't. It exists eternally. That is why it can be a store of value. When I hold gold, what I store is its utility value from now to eternity. Even if I don't need it now, someone will definitely need that gold in the future, someone needs it today, someone will need it in the future, but anyway, that gold will always be there.

The Deep Debate on Scarcity and Monetary Attributes

CZ: You just talked a lot, and many of the points you made were quite interesting. I feel like we are about to "convince" you to join our side.

Schiff: He doesn't think so. (Pointing to the audience below)

CZ: Let's start with gold. You mentioned earlier that gold "exists forever." But how much gold is there in the world?

Schiff: I don't need to know an exact number, but I know that gold is extremely scarce, and its supply growth is very slow.

CZ: But we indeed do not know the exact amount, right? We have no idea how much gold is still in the earth's crust.

Schiff: Yes, I also don't know how much gold is buried underground.

CZ: Maybe tomorrow we'll discover a giant gold mine, maybe in Africa, China, anywhere.

Schiff: Yes, it's possible.

CZ: Then the gold supply will suddenly increase. Furthermore, nowadays it's already possible to create synthetic diamonds, and perhaps in the future, chemical technology might be able to synthesize gold, which would be the ultimate goal of alchemy. Once that happens, gold won't be scarce anymore, and everyone could "produce gold."

Schiff: Alchemists have been trying that for hundreds of years. Indeed, someone claimed recently to have created minuscule amounts of gold.

CZ: I'm skeptical about that. But the key point is this: the total amount of gold is uncertain, while the total supply of Bitcoin is fixed. You mentioned earlier that the use of gold could extend into the future, but the Bitcoin supply is coded; we know exactly how much there will be in the end, and how much has been mined so far. It has a fixed supply mechanism.

You also mentioned a viewpoint on central banks and gold. We all know what happened in 1971 (the end of the gold standard). Therefore, as you said, modern currency is no longer backed by gold.

Schiff: Yes, modern currency can no longer be directly exchanged for gold. However, if a country's currency depreciates, central banks still need to use their reserve assets to stabilize the exchange rate, and gold is the most important of these. When the currency is under pressure, the central bank can sell gold, buy back the local currency, thus supporting the exchange rate. That's why central banks still need to hold gold reserves.

CZ: So when the price of gold rises, does that mean many central banks are printing more money to buy gold?

Schiff: Central banks have always been printing money; that's the source of inflation.

CZ: You previously mentioned utility value. Your point seems to be: Bitcoin has no value because it's not a physical, tangible asset like gold?

Schiff: Indeed, the value of gold does come from its utility.

CZ: But the industrial use of gold is not actually its primary source of value. Gold's main value comes from its scarcity. Similarly, Bitcoin has its own utility; it's not just a means of transfer. Bitcoin represents a monetary innovation, a technological upgrade to a new asset class.

Schiff: I don't think it's an upgrade to monetary technology because it hasn't been widely used as a currency. It's also not "money" because it's not a commodity. By definition, money should be the most liquid commodity, and Bitcoin does not meet this criterion, even if the government gives it some classification.

CZ: There are different standards for "what is money," and there are different levels of defining value. Bitcoin is now a $2 trillion, potentially $3 trillion asset and is growing healthily.

Schiff: Bitcoin certainly has a price, no one denies that. But the reason it has a price is that people are willing to buy it, and many holders are unwilling to sell because they hope for a higher price. Just because it has a price does not mean it has intrinsic value. Today, its main use is speculation; people buy it because they believe they can sell it for more in the future, which is a speculative behavior akin to collecting.

CZ: Your definition of money is very narrow, based on what you and the government are used to. Let's ask the audience, how many people think Bitcoin is money? (Raise of hands) See? Although we can argue about the definition of "money," in fact, many people do consider Bitcoin as money.

Schiff: But nothing is priced in Bitcoin. It is not a unit of account.

CZ: Prices are all relative concepts. We can easily reverse the calculation, like what one dollar is worth in Bitcoin.

Schiff: That's just an exchange rate conversion. The real issue is that no one selling goods or services prices them in Bitcoin. Even if employees receive a "Bitcoin salary," their compensation is fundamentally based on the dollar or euro and converted into Bitcoin at the time of payment. It is not used as a unit of account or widely used as a medium of exchange. Most Bitcoin is traded on exchanges, and people use it for speculation rather than consumption. You can't consider it a store of value because you can't store something you don't actually own.

CZ: Price volatility does not mean an asset cannot be used for payment. I received my salary in Bitcoin in 2014.

Schiff: What was your salary at that time?

CZ: I don't remember the exact number, and it's not that high, around $100,000 or so.

Schiff: Wait, you said you receive your salary in Bitcoin. Is your salary fixed in terms of a specific amount of Bitcoin?

CZ: As you mentioned earlier, we convert it every month based on the current exchange rate.

Schiff: So, it's not a fixed salary in Bitcoin. If it were a currency, someone would say, "My monthly salary is 0.1 BTC, and it remains the same regardless of price fluctuations." That would be a true Bitcoin-denominated salary.

CZ: I can show you some Binance contracts; we do have examples of settlements in Bitcoin. For instance, if an early investor or partner wants to exit, we tell them, "You can choose USD or Bitcoin." Both parties agree to settle based on a certain amount of Bitcoin, and later, with the price increase, they actually receive a higher value.

Schiff: That's because they were already Bitcoin investors, or they were willing to accept Bitcoin. That's an exception, not the norm.

Consensus of 300 Million Users vs. the "Bigger Fool" Theory

CZ: It's an exception, but it does exist, and some people do use Bitcoin as a unit of account.

Schiff: But that's not a common occurrence. The vast majority of Bitcoin transactions are not for purchasing goods or services but solely for trading Bitcoin itself. There's no output of labor, no exchange of goods, just buying and selling, speculation. That's what most of it is about now.

CZ: I don't entirely agree, but we may have digressed a bit. We're not debating whether "Bitcoin is a currency" right now. To discuss this, we first need to agree on the definition of "currency." However, the more important question is: Does Bitcoin have value?

Many here believe that Bitcoin does have value. Its value partly comes from speculation, but a significant part comes from its utility. I can hold it, carry it, transfer it across borders. You know I often have to move to different countries. If it were physical gold, that would be troublesome. Gold is undoubtedly a good store of value, but Bitcoin's value is not just in "storage"; it has been continually rising for the past 15 years, driven by real demand.

Schiff: Tokenized gold solves these issues because you can carry tokenized gold with you.

CZ: But the premise of tokenized gold is that you have to trust a third party.

Schiff: We only need to trust a reliable third party.

CZ: But for Bitcoin, I don't need to trust anyone.

Schiff: That is certainly a utility. However, although you don't need to trust a third party, you must trust something more abstract — you have to believe that people will still be willing to accept Bitcoin in the future.

CZ: I trust the technology.

Schiff: Even so, Bitcoin's value still depends on whether people continue to want it. Of course, you just mentioned that Bitcoin's total supply is 21 million coins.

CZ: Trusting Bitcoin's mathematics and code is very easy.

Schiff: In other words, it is 21 million satoshis. This makes it seem less scarce, especially with so many "satoshis." The total supply is indeed capped, but if people no longer need it, this cap is meaningless.

CZ: The fact is, people do need it. If you look at the growth data, Binance's user base has steadily grown to 300 million people.

Schiff: Yes, indeed, there are more people "gambling" on Bitcoin now. They are attracted by the hype and by early profit-takers who are selling their coins to newcomers. These activities have indeed attracted many people. However, the utility of Bitcoin you mentioned can actually be achieved by thousands of other tokens. Cross-border transfers, easy portability, and ease of sending — these are not unique features of Bitcoin.

Another point, you mentioned that we don't know how much gold there is on Earth. That's true. But we can also say that we don't know how many cryptocurrencies will be created because almost anyone can issue a new token at almost zero cost.

Take a look at those Meme coins, how did they come about? They are everywhere. Hundreds, if not thousands, in number and still growing. The supply is almost infinite, all competing for the same market. Bitcoin also emerged in this context...

CZ: Just issuing a new coin is meaningless. A token must be widely adopted by users, it must have real utility, not just a feature casually added to the product. Utility must be recognized by a large community. As for what you mentioned as "gambling," just on Binance alone, there are 300 million users holding some form of Bitcoin, which is a huge scale.

Schiff: Well, you really are running a large-scale casino.

CZ: No, no, Binance is not a casino, fundamentally it is a market. You see, our user base is larger than the population of most countries, I know it sounds exaggerated, but it's a fact.

Schiff: Indeed astounding.

CZ: When a system reaches a scale of billions of users, it is no longer just gambling.

Schiff: But scale will not change its essence. Whether you call it a decentralized Ponzi scheme, a pyramid structure, or a chain of trust, the mechanism will not change as the number of participants increases. More participants will not make it "legitimate." Are you suggesting that just because there are more people involved, it is reasonable?

CZ: The reality is, 300 million people have all participated in your so-called "pyramid."

Schiff: Exactly, that's the problem. It is a massive pyramid structure, even spreading to the entire world. Look at the situation in the past few years, Bitcoin's price is still around $40,000.

CZ: I think you mean "holding millions" instead.

Schiff: What I mean is, Bitcoin priced in gold, its purchasing power has decreased by 40% from four years ago. Four years ago, when Bitcoin hit a high of $69,000, it could be exchanged for 37.2 ounces of gold. Today, I checked just before coming, it's only about 22.15 ounces left. Its purchasing power against gold has dropped by 40%.

CZ: That was the high point four years ago. But in the past four years, gold has indeed outperformed Bitcoin. What if we extend the timeline, say to eight years?

Schiff: Let me finish my point. Even if we just look at the past four years, what has happened during this period? We saw the first launch of a Bitcoin spot ETF; a myriad of companies started emulating MicroStrategy's approach, with MicroStrategy itself investing billions of dollars in Bitcoin through stock and bond financing; other companies also increased their holdings. You can see Bitcoin appearing in Super Bowl ads, celebrity endorsements, and the NFT craze; El Salvador adopted it as legal tender; there was even a proposal to establish a strategic Bitcoin reserve.

All these resources, publicity, and funds are unprecedented. Every day, someone on financial media talks about Bitcoin, every ad is about cryptocurrency, and even the biggest donor in political campaigns comes from the crypto industry.

But despite such an intense push, the price of Bitcoin has fallen from the high point. If in four years of so many bullish events, it still dropped by 40% (even more when adjusted for inflation), why do you think it will go higher in the future? In my view, it is severely overvalued.

CZ: The price drop has various reasons. But if you look at certain intervals, it has fallen 80% compared to gold.

Schiff: Since you refer to Bitcoin as "digital gold," is it most reasonable to measure it against gold? I just used the high point from four years ago as a comparison, which is not arbitrary.

CZ: However, any asset can lead to completely opposite conclusions by choosing different time periods.

Schiff: This is not about "picking time frames randomly"; this is Bitcoin's historical high point. My point is, with such massive hype and promotion, the price has not reached new highs. Look at those who claim Bitcoin will rise to $10 million, like Michael Saylor. His logic seems to be as long as you buy Bitcoin, you will never lose, mortgage your house, bet your farm, borrow money to go all in because it will surely rise.

If this is "certain," the market price would have reflected it long ago.

CZ: Price reaching a reasonable level takes time. Just as you say gold will be worth more in the future, it doesn't mean it is worth that much today.

Schiff: I just think the US dollar will continue to depreciate, and the euro will do the same because central banks around the world are still printing money.

CZ: We all understand this point.

Schiff: But this has nothing to do with Bitcoin. The value of Bitcoin depends entirely on the number of buyers and sellers because it has no real use. Gold has real demand; some people need gold, so they buy it. If the price of gold falls, they buy more. But no industry "needs" Bitcoin; people just "want" it. And this "want" comes entirely from their expectation of a price increase. Once that idea disappears, no one continues to hold.

Payment Practice and the "Collaborative Space" Between Parties

CZ: Well, say what you will. So let's talk about the future, talk about the next generation, the young people of today. Do you think they will prefer Bitcoin or gold when they grow up?

Schiff: Prefer? I think they will ultimately prefer gold because they will be badly burned in Bitcoin. However, for young people, losing money actually has its "benefits."

CZ: It's "many people," not "some people."

Schiff: But he already sold his coins. My point is: losing a lot of money in Bitcoin early in life is actually beneficial because you are young, you have a lifetime to make the money back, and you have a lifetime to learn from this painful experience. So, for young people who will go broke in a Bitcoin collapse, the good news is that the money you are losing now will prevent you from losing more in the future. When you are young, you didn't have much money to begin with, so the losses are limited. When you are older, and have accumulated wealth, that's when "not losing money" really matters. From this perspective, Bitcoin is an expensive but valuable lesson.

CZ: Bitcoin went from being worthless in 2010, to 50 cents during the famous pizza transaction, to today's $100,000 or $90,000. Do you know how many people have lost money on Bitcoin and how many have made a fortune? Too many.

Schiff: Alright, then let me ask: How many people here have actually sold their Bitcoin and pocketed the profits? Obviously, not that many.

CZ: But you have to realize, the audience here is quite different.

Schiff: There is no denying that: those who bought Bitcoin early indeed made a huge fortune. I know many people who made over a billion dollars.

CZ: Some even made tens of billions of dollars. So you are well aware of this.

Schiff: Yes, many of them are actually my neighbors in the community. They can afford the expensive houses there because they sold off a large batch of Bitcoin they bought early on. It's as if they won a big lottery.

CZ: But this money was earned by them. Many people you know made a lot of money through Bitcoin.

Schiff: But that's because they got in early. Those who got in in the past few years haven't made any money at all. It's the losses of the latecomers that make up the gains of the early buyers; those who are making money are cashing out. Everything Bitcoin has done is simply transfer wealth from buyers to sellers. The creation of Bitcoin itself has not added any real wealth to the world. We now have around 20 million Bitcoins, something that didn't exist 15 years ago. But the existence of them hasn't made our lives any better. Bitcoin doesn't produce any value; it merely enriches some by sacrificing the assets of others.

And, those who have lost a lot of money on Bitcoin haven't even realized it yet because they still hold Bitcoin and the book value is still ninety thousand, ninety-three thousand dollars, or any current number. But once they try to exit, the losses will become immediately apparent. If a large number of holders try to sell at the same time, Bitcoin simply doesn't have enough market to absorb it, and the market will collapse directly.

CZ: Let me share a little story I told earlier today. During the time of my experience with the lawsuit in the United States, I received many letters from users supporting me. One user from Africa told me that before Crypto, before Bitcoin, he had to walk three days from the village to the office to pay bills, and then walk back. Three days a month were spent on the road, which was a huge time cost. But since he got into Crypto, started using Binance, his payment time became three minutes. In this change, he slowly accumulated $50, $100, $300, even $1000. $1000 is a huge sum for people in some impoverished countries in Africa. This has indeed changed his life.

Schiff: I admit there is indeed value there, but you don't need Bitcoin itself. You can easily use a stablecoin, tokenize assets, such as tokenized gold, or other blockchain-based forms.

CZ: Yes, even when using stablecoins, you are still relying on blockchain technology. And the most widespread and successful application of blockchain to date is still Bitcoin. Bitcoin has the largest market capitalization and user base. You have said, "Just because anyone can issue a token doesn't mean the token has value," but Bitcoin is entirely different. It has already built a huge global community. Mainstream crypto assets, including some projects on Binance, also fall into this category. Value is not generated because you "issue something," but because people actually use it. This African user is using it, and more people around the world are using it. Its use cases are expanding, not diminishing. It is no longer just a "slightly better than spare change" thing; it is a technology that truly helps people preserve value.

Schiff: I don't see it that way. I remember when Bitcoin first surged to $1,000, how many years ago was that?

CZ: You were also against it at that time.

Schiff: Of course, I was against it. Although at that time, I thought the price might rise again because clearly people were buying, fundamentally, nothing has changed about Bitcoin. It reminds me of the time when many merchants announced "We accept Bitcoin," for a simple reason: Bitcoin was rising too fast, hodlers suddenly became rich, and merchants tried to attract these newly wealthy users. But now this situation has become less common. Today, the idea of using Bitcoin as "currency" is less popular than it was back then. Even within the industry, it is acknowledged that Bitcoin does not perform well as a means of payment, and many other cryptocurrencies are actually more suitable as currency. So they changed the narrative, packaging Bitcoin as "digital gold." But it is not digital gold; it is completely different from gold. It's like if I take a picture of a hamburger, I can't say this is "digital food"; eating it won't fill you up.

CZ: Let me ask the audience, who has a Binance Card with them now? I don't have mine. Who can pass one up?

Schiff: That's a token, right? BNB is a token. Um no, it's?

CZ: That's a Visa card.

Schiff: But BNB is indeed a token.

CZ: I just wanted to showcase the card itself. When you say Crypto is not used for payments, and its usage is decreasing, I want you to take a look at this. Thank you. You see, this is the Binance Card.

Schiff: But what you mean is, this card will sell off the user's Bitcoin and then pay the merchant in dollars, right?

CZ: Yes, it operates very smoothly.

Schiff: But this is different from my vision of gold payments. I hope gold truly transfers from the buyer to the seller, without the need to convert to fiat. Your card, while convenient, is not using Bitcoin for payment itself; you are selling Bitcoin to acquire dollars, then using those dollars for payment, no different from a debit card linked to any brokerage account. You are not "paying with Bitcoin," you are simply selling Bitcoin and then consuming with the cash received. That card simply keeps you within the traditional financial system.

CZ: But is anyone really using gold for payments today?

Schiff: Hardly anyone.

CZ: So, are there more people paying with Bitcoin or gold?

Schiff: But you are also not "paying with Bitcoin" there. When using that card, Bitcoin is sold, and the merchant always receives dollars.

CZ: This needs to be looked at from two perspectives: merchants not wanting to accept Crypto, or having difficulty accepting Crypto, is a historical issue. If merchants do not accept, users cannot pay. And the Binance Card solves this dilemma: users swipe the card, crypto is deducted; merchants receive the fiat they desire; we handle the conversion in the middle, benefiting both parties.

Schiff: But I wouldn't use gold to perform the same spending operation as I would with cryptocurrency. The key is: as developed countries face more severe inflation in the future, I believe more and more merchants will be willing to accept gold.

CZ: How many merchants have that special ability...

Schiff: They don't have that ability now; it's not even an option. But say you're a merchant, right? Inflation isn't 2% a year, it's 2% a week. You sell your inventory, and by the time you restock, the cost has skyrocketed because prices have risen between the sale and the restocking. But if you receive gold, you can restock with gold; and in a gold-priced system, costs don't skyrocket due to short-term inflation.

CZ: But the gold price has also dropped in the past few weeks. You just mentioned the peak, but it has indeed fallen recently.

Schiff: That's the overall trend in recent years. Sometimes the gold price surges, so it usually doesn't "stably decline" as you said.

CZ: For businesses with only a 10% profit margin, this kind of fluctuation...

Schiff: I certainly know. But Bitcoin fluctuating 10% in a day is not unusual either.

CZ: I can assure you, there are already millions of users using the Binance Card.

Schiff: Then maybe I can ask you to make me a "gold card."

CZ: I'd be very happy to do that, you know... I'm actually considering something similar myself.

Schiff: I'm already in talks with banks to see who is best suited to be the issuer.

CZ: Of course, I'm a Bitcoin supporter, as you know. I'm not against gold; I'm just saying Bitcoin is "better gold." You mentioned earlier that people don't use it for payments, but in fact, many people are using it for payments "seamlessly."

Schiff: But that doesn't even qualify as a true payment method.

CZ: From the user's perspective, they are using it for payments right now. They don't need to sell Bitcoin themselves, exchange for cash, convert to fiat, and then make a payment, right?

Schiff: But I could easily achieve the same effect with gold or other assets. I could do this with a stock portfolio. I have some clients with brokerage accounts, I could issue them a debit card, use the account as collateral each time they swipe, then sell some stock to complete the payment. It's the same mechanism.

CZ: That's good, but my point is: people have indeed been using Crypto for payment.

Schiff: No, they are not using Crypto for payment. They are using Crypto as collateral, selling it for fiat currency to make payments. This is a different concept. It is not being "directly used" as a medium of exchange. You are settling Bitcoin and then using the proceeds from the settlement to spend. There is a fundamental difference here.

CZ: It's just a matter of definition. From the user's perspective, we handle the entire backend conversion. They swipe the card, and they get the stuff.

Schiff: I understand, but there is indeed a difference. And if the Bitcoin price were to suddenly collapse, it would be a big problem for those who planned to spend Bitcoin because when they actually go to sell, they won't get much money, and therefore won't be able to buy much.

CZ: I think most people here wouldn't have that issue; they hold enough Crypto.

Schiff: When the price was $93,000, there was enough value in the coin. But if it drops to $9,000? Who knows where it will drop to?

CZ: I mean, prices are always fluctuating. Even the value of fiat is fluctuating, right?

Schiff: Relative to each other's fluctuations?

CZ: Relative to each other and relative to actual purchasing power. All prices fluctuate. Many people call stable coins "Stable coins," but in my view, this term is completely misleading. There is nothing truly stable in the world; everything is constantly in flux.

Schiff: It is stable to itself. A USD stable coin is stable against the USD, but the USD itself is unstable. That's why I think: what Bitcoin can do, gold can do. And since you can hold a token backed by real gold, why hold a token backed by nothing? Why? If you can hold a legitimate, real, regulated gold-backed asset, why choose a "fiat-backed cryptocurrency"?

CZ: But the essence is actually the opposite: Whatever you can do with gold and fiat, we can do on Bitcoin.

Schiff: But you can't do it now because you can't store value in Bitcoin. When it comes to storing value, Bitcoin has always been merely a speculative asset.

CZ: Bitcoin's price has been rising for the past 15 years during its entire existence.

Schiff: Yes. But first of all, from a long-term perspective, this is not a "long enough" time. Bitcoin has a price, I admit. But "price" and "value" are two different things. You can't store "price." Bitcoin has a price today, but no one knows what it will be tomorrow. It has no "intrinsic value" today, and it won't have it tomorrow. But that doesn't stop people from buying it. The vast majority of people attribute value to Bitcoin because they believe that buying it will make them rich. They think, "As long as I withstand the volatility, I will eventually become wealthy." That's where its demand comes from.

When people are no longer willing to buy it, when the fantasy of "BTC to the moon" disappears, the demand will also disappear.

CZ: Your perspective on this issue is entirely from a speculator's point of view, but that's not accurate.

Schiff: The vast majority of people buying Bitcoin are speculators. Maybe many in this room are Bitcoin maximalists and truly believe in those narratives, fine. But who do you think the majority of Bitcoin buyers are?

CZ: You mean Bitcoin? How many people here are developing in the Bitcoin ecosystem? There are many people writing code, working on projects; there's a group right here. So not everyone is a speculator. Of course, speculators do exist...

Schiff: But this room itself is already a biased sample.

CZ: Of course, I know that.

Schiff: Right? Developers are important to the ecosystem, but they are only part of what drives Bitcoin. What really drives the buying pressure is the Bitcoin ETF. Those institutions, those corporate treasuries that entered earlier, they bought it just because it was going up. They saw the hype, were told, "You should buy, this is a digital asset, it will rise," so they put it in their portfolios. They don't care at all about your so-called Bitcoin characteristics. They don't self-custody; they just buy a ticker symbol through a broker. They expect the price to rise; if the price stops rising or even falls, they will sell and move on to speculate elsewhere.

CZ: What you're describing is exactly the same in the stock market and the fiat currency market. Every market has speculators and builders. Speculators have the loudest voices and move the fastest, which is why NASDAQ exists. Those buying Bitcoin ETFs are also buying stock ETFs and currency ETFs. The traditional markets are the same. So, just because there are speculators, it doesn't mean that Bitcoin has no value.

Schiff: Indeed, but having speculators in the stock market doesn't legalize Bitcoin. When I speculate on a stock, at least theoretically, I'm betting on a company's future value. It may grow, increase sales, grow profits, increase dividends. In other words, I'm betting on the company's development, not just pure speculation.

Schiff: Binance is not small, right? Binance is a good business. You are the casino, you are the house, the profit model is obvious.

CZ: We are a licensed financial institution in over 30 countries. Legitimate, regulated financial institution. Okay, go on.

Schiff: Also, in addition to the people trading Bitcoin on your platform. Wait, where was I? You interrupted me, I forgot what I was trying to say.

CZ: We were talking about speculators.

Schiff: Yes. So, when you speculate on a company, you are betting that it will be more valuable in the future. But when I buy Bitcoin, Bitcoin will not generate more income in the future because it currently has zero income. It is not a productive asset. When I speculate on Bitcoin, I am betting that someone will buy it at a higher price in the future, purely betting on the demand being higher in the future, the price being higher. It is a one-dimensional price speculation.

Unlike stocks or real estate, Bitcoin is more speculative. When you buy stocks, most of the time you are buying into a company that actually generates income, pays dividends; not all stocks are purely speculative. But Bitcoin is 100% speculative. I buy it simply because I believe someone will pay a higher price in the future. And that person buys it because they believe the next person will pay a higher price, the asset itself has not changed.

CZ: We've already discussed: Speculators are indeed part of the ecosystem, although they are loud and trade frequently, they are just one part, right?

Schiff: But that's precisely what's driving the price.

CZ: You're magnifying a subset of people in the ecosystem to be everyone. If it was just speculators, Bitcoin's price wouldn't hold at all. There are always some fundamental holders in the market supporting the price.

Schiff: Yes, but Bitcoin has fallen 40% relative to gold in the past four years. And I dare say that at least half of those holding Bitcoin today bought in the last four years.

CZ: I'm not sure.

Schiff: I am sure. And at least half of the market cap was bought in these four years.

CZ: In the later stages of each cycle, indeed, a lot of value is bought at high prices. But in terms of people, I'm not sure because the scale of this ETF cycle is very large, as you also mentioned.

Schiff: Yes, those individual shareholders in the ETFs, they indirectly hold Bitcoin through the ETFs, they are newcomers, they did not have the massive gains of early adopters.

CZ: But the early gains were never going to be replicated. This is true for any asset; it can't always increase by 100 times, 1000 times.

Schiff: But these people still have such expectations. People who buy Bitcoin do expect massive gains. If you look back at all the predictions at the beginning of the year, a bunch of "fundamental analysis," "macro analysis"... Bitcoin is now lower than it was on January 1st.

CZ: If you look back, it's a higher point than last November.

Schiff: That's because it was sold off before. But looking back at Saylor (MicroStrategy founder) and his calls at the beginning of the year, where did they say Bitcoin would be by year-end? Not a single prediction was lower, all were 200,000, 250,000. It's always a pie-in-the-sky forecast. Retail investors buy Bitcoin hoping it will keep going up. They're not entering to lose money, but the result is indeed that they are losing.

CZ: This is happening. There are always people making predictions in the market. I usually don't make predictions, but when the price goes up, people invest. They are either willing to take the risk or understand the market.

Schiff: I think that's true for many people.

CZ: The same goes for gold and the stock market.

Schiff: But you don't see a large influx of retail investors rushing into gold. I've been in the gold business, running Schiff Gold since 2010, and the number of people consulting about it hasn't been high.

CZ: Indeed, there has been a significant influx of funds into the crypto field, but not into gold because gold doesn't have a "get-rich-quick" attractive story. People pursue higher returns, which is typical of TikTok-era users.

Schiff: But in the past few years, especially the last four years, gold has actually outperformed Bitcoin. However, those who bought Bitcoin did not buy gold. It's the central banks of various countries that are buying gold. They know what they are doing: buying gold instead of Bitcoin. But I believe that moving forward, more private investors will buy gold, and the funds released after the Crypto bubble bursts may accelerate this process.

Schiff: In fact, I have always believed that the reason Bitcoin has been so strong over the past decade is largely because gold has been consolidating for 12 or 13 years. Gold rose from less than $300 in 1999/2000 to $1,900 in 2011, with a huge increase, attracting a lot of capital; but then it started a long period of consolidation. During this window, Bitcoin emerged and was packaged as "digital gold."

CZ: Gold 2.0.

Schiff: Yes, referred to as "gold 2.0." As long as gold weakens, Bitcoin can steal its thunder, attracting capital that should have flowed into gold, gold stocks, and other precious metals-related assets. But now gold has broken out of its consolidation zone. In the past two years, the price of gold has doubled, and silver has caught up, currently at historical highs, close to $60 per ounce, breaking the previous double top resistance around $50.

Schiff: So we are now in a new phase of the precious metals bull market. I don't think gold and silver will trade sideways again; they could continue to strengthen over the next few years. In this environment, I think it will be difficult for Bitcoin to compete. People who already hold gold have no reason to sell their gold to buy Bitcoin; and those who made the mistake of selling their gold to buy Bitcoin a few years ago will now regret it and try to reverse the trade by selling Bitcoin to buy back gold. But by then, there may be no buyers for Bitcoin, causing the price to collapse.

CZ: Alright, so let's agree to disagree at this point. I do hope that gold performs well and that your tokenized gold project is successful.

Schiff: Perhaps we can even collaborate on that product.

CZ: Of course.

Schiff: I would like to have my token listed on platforms like Binance.

CZ: No problem. We welcome you to the world of digital assets, entering a truly functional digital realm. Of course, my belief is different from yours; I believe gold will perform well, but Bitcoin will perform even better.

Schiff: I don't think Bitcoin can compete with gold, especially on a physical level.

CZ: Well, we'll find out next year. Finally, thank you, Peter, for being here. I wish you all the best with your tokenized gold endeavor.

Schiff: Thank you, everyone.

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