CZ Slams Peter Schiff's Tokenized Gold as a 'Trust-Me-Bro' Token

A 'Trust-Me-Bro' Token? CZ Takes Aim at Peter Schiff's Tokenized Gold

Binance Founder Changpeng Zhao, affectionately known as CZ in the crypto space, has recently sparked a debate by criticizing Peter Schiff’s launch of a tokenized gold platform. CZ likened it to a “trust-me-bro” token, arguing that it’s not truly on-chain. Instead, it relies on trusting a third party to redeem the precious metal.

CZ Criticizes Peter Schiff’s Plans

In a recent X post, Binance founder CZ questioned Peter Schiff’s launch of a tokenized gold platform. According to him, it is just a “trust-me-bro” token. He added,

It’s tokenizing that you trust some third party will give you gold at some later date, even after their management changes, maybe decades later, during a war, etc.”

Further, Zhao added, in a pointed remark, that the flaws in the concept are well-known within the crypto community. "Most people ‘in crypto’ know this," he stated, "most people 'not in crypto' may not understand yet." With this statement, he indirectly states that the economist may not understand the idea, as he is a crypto-critic.

Peter Schiff’s Notion

Significantly, CZ’s comments come in direct response to Schiff’s recent interview, where he announced his plans to launch a tokenized XAU platform and a new neobank. He posited,

"You'll be able to buy gold on an app through your phone…will be stored in a vault and then you will be able to effortlessly transfer ownership…to people you know or redeem it for physical..."

The platform will allow the yellow metal to be used as a payment medium, enabling users to send and receive payments and use debit cards. This will make the metal automatically sold at the time of the transaction for settlement. Previously, he noted,

“I've always said that tokenized gold was where blockchain and crypto would ultimately end up. Tokenizing real assets, to increase liquidity and portability adds value. Tokenizing worthless strings of numbers does not.”

Despite being a crypto critic, he added that if he had bought Bitcoin when he first heard about it, he would have achieved the greatest returns of his career. He also admitted, “In hindsight, that’s what I should have done.” However, he also believes that most investors will ultimately lose money on Bitcoin.