‘Backed by nothing’: Peter Schiff says bitcoin can’t rival tokenized gold in debate with CZ

Binance founder Changpeng "CZ" Zhao and gold advocate Peter Schiff sparred over what should back digital money during a headline debate at Binance Blockchain Week today in Dubai on Thursday.

Despite previously trading barbs on Twitter, the debate opened with an unexpected point of agreement: tokenized gold might be better money than physical bars.

Schiff opened by outlining his new TGold platform, which sells vaulted, allocated metal and will eventually let users withdraw either physical bars or a token representing ownership. "Because the token is divisible, you can transfer any portion of it to someone else, and that transfer gives them ownership of the gold without moving the physical metal," Schiff said.

CZ agreed, saying that "Tokenized gold is actually almost better than the gold itself … divisible, transferable, transportable."

But that common ground didn’t hold for long.

'Backed by nothing'

Schiff argued bitcoin mirrors fiat money because "it’s backed by nothing." Tokenized gold, he said, derives value from the metal itself, while bitcoin "doesn’t have a utility beyond the fact that I can transfer it to you and you can transfer it to somebody else."

CZ countered that bitcoin’s nonphysical nature doesn’t undermine its value. "Bitcoin actually doesn’t exist anywhere … but it doesn’t mean that because it’s virtual, it has no value," he said, pointing to digital platforms like X and Google as purely virtual yet unquestionably valuable. Bitcoin, he argued, is "a new technology for money" supported by a global network.

Scarcity was another dividing line.

Schiff emphasized that gold "doesn’t go away," with metal mined thousands of years ago still circulating.

CZ argued gold’s true supply is unknowable, while bitcoin’s is fixed. "With Bitcoin, we know exactly how much there will be, and we know exactly where they are," he said.

Utility vs. speculation

The pair also disagreed over whether bitcoin is useful money.

Schiff said it fails basic monetary tests because "nothing is priced in bitcoin," and merchants ultimately receive fiat. "You’re selling your bitcoin and then you’re paying with currency," Schiff said.

Holding up a Binance card, CZ insisted users are paying in crypto: "From the user perspective, he just swiped his card and crypto gets deducted."

For Schiff, bitcoin remains a speculative bubble. He noted that despite ETFs, corporate treasury buys, and nonstop hype, bitcoin “buys 40% fewer ounces of gold today than it did four years ago."

"All Bitcoin does is enable a transfer of wealth from the people who buy … to the people who sell,” Schiff said.

CZ argued that view ignores long-term performance and real-world utility. "How many people made money on Bitcoin?" he asked, pointing to its climb from fractions of a cent to 10s of thousands of dollars. He cited a user in Africa who used crypto to cut bill payment times from three days to three minutes, helping him save his first $1,000.

The session closed with CZ predicting “Bitcoin will do even better” than gold, while Schiff said that rising precious-metals demand will eventually overwhelm crypto.