Technology billionaire Peter Thiel said Sunday at a conservative conference that the high price of bitcoin is an indicator of U.S. inflation, which has also recently touched a 13-year high.
“You know, $60,000 bitcoin, I’m not sure that one should aggressively buy,” Thiel said, according to Bloomberg. “But surely what it is telling us is that we are having a crisis moment.”
Thiel was critical of the Federal Reserve claiming that they were not acknowledging the seriousness of the problem, and mentioned that the prices were not coming down any time soon.
While proponents of cryptocurrencies hold the view that bitcoin prices are similar to that of gold, and will hold even in times of high inflation, other investors do not carry the same perspective. Bitcoin rose above $66,000 in October.
“We believe the perception of bitcoin as a better inflation hedge than gold is the main reason for the current upswing, triggering a shift away from gold ETFs into bitcoin funds since September,” JPMorgan analysts had written in a note on Oct. 20.
High prices have led to many investors turning towards inflation hedges which included the use of bitcoin as a hedge, according to Nikolaos Panigirtzoglou from JPMorgan.
Thiel said the Fed was in a state of “epistemic closure,” meaning close-mindedness, and they were of the view that printing money to resolve market issues will not impact inflation. The Fed has printed trillions worth of currency during the past few years.
The U.S. consumer price index inflation faced a year-on-year increase of 5.4 percent in September, a 13-year high. The markets have ramped up product prices reflecting the recovery from the pandemic. It is also due to supply chain issues facing the country.
Even though Thiel said that he regrets not buying more cryptocurrencies early on, institutional investors are not keen on adding the category to their portfolios. They remain wary of the wild volatility of crypto investments.
Thiel is a co-founder of industry behemoths like PayPal and Palantir, along with being an early investor in Facebook. Palantir has started accepting bitcoin as a mode of payment and added the currency to its investment portfolio.
The National Conservatism conference was held in Orlando, Florida, Oct. 31 to Nov. 2. Thiel was one of the keynote speakers, which also included Sen. Ted Cruz, Sen. Josh Hawley, Sen. Marco Rubio, and Ohio Senate candidate J. D. Vance.
Other speakers include political commentators and authors like Ayaan Hirsi Ali, Seth Dillon, Vivek Ramaswamy, and Michael Knowles.
