Peter Schiff Warns That “Weak Hands” Will Deepen Bitcoin’s Future Declines
Long-time bitcoin critic and economist Peter Schiff has issued a new warning about the state of the crypto market. According to him, bitcoin’s recent downturn is being amplified by a major shift in ownership — from long-term holders to new investors he describes as having “weak hands.” Schiff argues that this transition will increase the likelihood of deeper sell-offs in the months and years ahead.Schiff compared the current environment to an “IPO moment” for bitcoin. In his view, liquidity in the market has grown large enough for long-term holders to take significant profits. As these stronger, more experienced holders exit, the supply moves into the hands of newcomers who are less prepared for volatility and more likely to sell during sharp price swings.
“Strong hands” are leaving — and supply is rising
Schiff noted that more than 400,000 BTC have been sold by whales and long-term investors during the latest correction. This wave of distribution, he says, has created heavy sell-side pressure and contributed directly to bitcoin falling below $85,000.In his analysis, the issue is not just the amount of bitcoin being sold but who is selling and who is buying. When seasoned holders divest and coins end up with less committed investors, the market becomes more fragile. Weak-handed buyers are more prone to panic selling, which increases future volatility and makes the price structure less stable.
Why Schiff believes future sell-offs will be worse
Schiff argues that if a significant portion of bitcoin supply is now concentrated in the hands of investors with low conviction, future corrections could become sharper and more frequent. Historically, long-term holders have acted as a stabilizing force, absorbing supply during downturns and reducing the severity of crashes. As their share decreases, this stabilizing effect weakens.He predicts that when the next wave of fear hits the market, weak-handed investors may trigger a cascade of selling. Since these buyers tend to enter during bullish periods, their tolerance for drawdowns is lower, increasing the likelihood of rapid exits during turbulence.
A familiar bearish stance — but some data supports it
While Schiff remains one of bitcoin’s harshest critics, some on-chain data does align with his argument. Metrics tracking investor composition show a measurable rise in short-term holder supply. At the same time, profit-taking by whales and institutional players has been unusually high compared to earlier phases of this cycle.This does not necessarily confirm Schiff’s long-term bearish outlook, but it suggests that the market structure has indeed changed. The shift in supply dynamics may influence bitcoin’s short- and medium-term volatility even if long-term fundamentals remain strong.
Market psychology remains the deciding factor
Ultimately, Schiff’s warning highlights a recurring theme in crypto markets: investor psychology often matters as much as fundamentals. When panic spreads among new entrants, even modest negative news can lead to outsized reactions. Conversely, when long-term holders dominate, markets tend to recover more quickly from downturns.Whether bitcoin’s current correction evolves into a deeper decline depends not only on macroeconomic conditions but also on how these new weak-handed holders react to the next period of volatility. For now, Schiff believes the risks are rising.
Editorial Team — CoinBotLab