Schiff vs. CZ: Tokenized Gold Beats Bitcoin

Peter recently debated Binance founder Changpeng Zhao (“CZ”) in Dubai at the Binance Blockchain Week. In their dialogue, Peter goes through the case for tokenized gold and lays out why a gold-backed token can actually improve gold’s usefulness as money without sacrificing its long-term value. He contrasts tokenized gold with Bitcoin and other crypto mania—calling out the hype, the ETFs, and celebrity promotion—and predicts that a rising gold market will expose Bitcoin’s weaknesses.

He starts by explaining how a token can turn physical gold into an everyday medium of exchange while preserving the metal’s core monetary function:

And now you can use your token as a medium of exchange. And so now you have a viable monetary unit that is a store of value because it’s backed by the gold that’s in the vault that anybody can take delivery of. But in the meantime, you’ve taken gold and you’ve now made it more transportable, more divisible, more fungible. You’ve improved on all of its monetary properties. But you don’t lose the most important property, which is its store of value because its value is the gold that the token represents.

He points out that tokenization is nothing new in principle—paper receipts and IOUs once stood for stored metal—and that the token only changes the form until someone actually needs the metal for industrial or craft use: