CZ's first battle after being pardoned! Peter Schiff debates whether gold or Bitcoin is the real currency.

A battle about the future of currency is brewing after gold advocate and long-time Bitcoin critic Peter Schiff publicly challenged Binance co-founder CZ to a live debate on Bitcoin and tokenization of gold. Schiff invited CZ to discuss “which currency best meets the criteria of money,” referring to the traditional economic functions of a medium of exchange, unit of account, and store of value.

Sif publicly challenges CZ to debate the three main functions of currency

In a post earlier this week, Schiff invited CZ to discuss “which currency best meets the conditions of money,” referring to the traditional economic functions of a medium of exchange, unit of account, and store of value. These three functions are the standard framework for defining money in economics textbooks, and Schiff attempts to challenge the legitimacy of Bitcoin using this classic framework.

A medium of exchange refers to a currency that can be widely accepted for the purchase of goods and services. A unit of account refers to the prices of goods and services being expressed in that currency. A store of value means that the currency can maintain its purchasing power over time. Schiff argues that gold outperforms Bitcoin in all three aspects, particularly in terms of store of value, as gold has undergone 5000 years of historical testing.

Earlier today, CZ received a presidential pardon from Donald Trump, to which he replied that he was interested in doing so. He further added, “Although you oppose Bitcoin, you have always behaved professionally and objectively. I appreciate that. We can debate this further.” CZ's response demonstrates his confidence and openness to debate. As the founder of the world's largest cryptocurrency exchange, CZ will represent the entire crypto industry in this debate.

This debate comes at a time when gold and Bitcoin are garnering global attention. Due to the ongoing deadlock in the U.S. government and concerns over fiscal stability, gold prices recently reached a new high of over $4,035 per ounce, while Bitcoin broke the $126,000 mark earlier this month, setting a new historical record. Both assets have shown impressive performance in 2025, making the debate of “which is superior” even more captivating.

This transaction has reignited one of the oldest debates in finance: whether digital scarcity or physical scarcity will determine the next era of currency value. This is not just an academic discussion; it also concerns the future flow of trillions of dollars in assets. If gold prevails in the debate, it may attract more conservative investors to tokenize gold; if Bitcoin's argument is more persuasive, it could accelerate the flow of institutional funds from gold to cryptocurrency.

Tokenization of Gold vs the Nature of Native Digital Assets Controversy

(Source: CoinGecko)

The famous economist and CEO of Euro Pacific Asset Management, Peter Schiff, has been criticizing the value proposition of Bitcoin for years. He believes that the volatility, speculative nature, and lack of intrinsic value of cryptocurrencies make them unsuitable as a currency or a long-term store of value. In contrast, he considers gold, especially tokenized gold, to be a high-quality asset that combines the tangible backing of precious metals with the efficiency of blockchain.

In a recent interview, Schiff stated, “Ideally, the only thing that should be on the blockchain is gold.” He explained that his upcoming tokenization gold platform will allow users to buy, store, and exchange gold using blockchain-based tokens issued by his company, Shift Gold. “You can use tokenized gold as a medium of exchange, unit of account, and store of value.”

CZ made a sharp response to Schiff's statement, arguing that while tokenization of gold is technically interesting, it is not truly “on-chain” because it relies on third-party custodians. “Gold tokenization is not 'on-chain' gold,” CZ wrote on X. “Gold tokenization means you believe some third party will give you gold at some point in the future—maybe decades later, during a war, after management changes, etc. This is a 'trust me, bro' token.”

He added that trust-based systems are precisely the reason why “coins have not really taken off.” He reiterated his view that the decentralized structure of Bitcoin makes it a more reliable form of digital currency. This argument hits at the core weakness of tokenized gold: the trust assumption. Holders of tokenized gold must trust that the issuer truly holds the corresponding amount of physical gold, trust that the custodian will not be robbed or misappropriated, and trust that the issuer will still exist in the future and fulfill redemption promises.

In contrast, Bitcoin does not require any third-party trust. It is entirely guaranteed by mathematics and cryptography, and anyone can verify the integrity of the Bitcoin blockchain without having to trust any intermediaries. This “trustless” characteristic is the core value proposition of Bitcoin and is also CZ's most powerful weapon in rebutting Schiff.

The Ultimate Test of Gold 5000 Years vs Bitcoin 15 Years

(Source: Newhedge)

Schiff believes that gold has a history of over 5,000 years as a stable store of value, proving its reliability. He also points out that by 2025, gold will outperform Bitcoin in terms of stability and price growth. Data shows that since the beginning of 2024, Bitcoin has surged by 150%, while gold has risen by about 100% during the same period; however, its recent gains have already surpassed the consolidation phase of Bitcoin.

However, despite this, Bitcoin's long-term performance still far exceeds that of gold. Since its inception in 2009, the price of Bitcoin has skyrocketed from less than one cent to over $126,000, an increase of millions of percentage points. CZ previously predicted that Bitcoin's market value could eventually “surpass” gold, although he acknowledged that this might take time. The current market value of gold is nearly $30 trillion, while Bitcoin's market value is about $2 trillion, meaning Bitcoin needs to grow 15 times to catch up with gold.

In recent months, the correlation between Bitcoin and gold has weakened. Data shows that although these two assets were almost perfectly correlated at the beginning of 2024, their correlation has since dropped to 0.19, indicating that they are now essentially fluctuating independently. This breakdown of correlation provides arguments for both sides of the debate.

The Core Differences Between Gold and Bitcoin:

Historical Validation: Gold 5000 Years vs Bitcoin 15 Years

Market Capitalization: Gold $30 trillion vs Bitcoin $2 trillion

Trust Model: Gold requires physical custody and third-party trust, while Bitcoin does not require trust.

Volatility: Gold is relatively stable, while Bitcoin is highly volatile but offers astonishing long-term returns.

This debate comes at a time when the tokenization of the gold market is thriving. According to data from CoinGecko, the total market capitalization of gold tokens such as Tether Gold (XAUT), PAX Gold (PAXG), and Kinesis Gold (KAU) recently surpassed $3.75 billion, up from $3 billion earlier this month. In an environment of political and economic uncertainty, investors are seeking stability, driving daily trading volumes of these assets to exceed $640 million.

Tokenized products led by gold account for over $3.5 billion of real-world asset (RWA) tokenization, growing by 36% over the past month. During the same period, more than 150,000 holders and 20,000 active addresses interacted with gold-backed tokens, while the monthly transfer volume has surged to over $8.6 billion. These data provide empirical support for Schiff's argument: the demand for gold remains strong, and blockchain technology can enhance the liquidity and availability of gold.

Despite the increasing popularity of gold-backed assets, some analysts believe that the Bitcoin market may be entering a new phase of maturity. Lightspark CEO David Marcus recently stated that Bitcoin is still “severely undervalued” compared to gold, and if Bitcoin's total market capitalization were to match that of gold, the price of each Bitcoin could reach $1.3 million. He referred to Bitcoin as the “Internet of Money,” emphasizing its role as a global settlement layer for cross-border payments.

Bitwise Chief Investment Officer Matt Hougan also pointed out that the significant rise of gold in 2025 might provide clues for Bitcoin's next movement. He attributes the rise of gold mainly to the accumulation by central banks since 2022, and stated that once large-scale institutional accumulation begins, Bitcoin may exhibit a similar momentum. This observation offers a new perspective for the bullish narrative on Bitcoin: the success of gold could be a prelude to Bitcoin, rather than competition.