I think it's ironic.

Because the man who coined the phrase was none other than Friedrich Nietzsche, a non-theistic person who famously succumbed to madness later in life.

It does touch on some of the more blurry aspects of faith. For example; In Jesus's time, there was another self-proclaimed savior of the Jews: called Simon the flyer, who was famous for raising the dead, curing the sick and diseased, and oddly enough, flying. When the authorities asked him to prove that he could fly, in front of a large crowd he lept off of a ledge... and broke his leg. Laughable, for sure, but what if the authorities had asked Jesus to walk on water in order to prove that he was the savior? Christianity as we know if might not have existed if Jesus tried and failed miserably. Romans were hard-nosed realists, and if someone in Galilee had been proven to have walked on water, the Romans would have almost certainly wrote it down. But they didn't. There isn't even any real Roman record that Jesus existed at all (they're all second-hand sources).

How about the numerous other miracles in the bible which are known copycats of miracles in other religions? Moses turning his staff into a snake is a famous example of an older Egyptian myth.

Furthermore, how does a Christian prove that Muhammed wasn't the prophet of God? They can't. How do they prove that Jesus was in fact the son of God and not an imposter as the Jews say he is? They can't. How can they prove that Joseph Smith, the spiritual founder of the Church of Jesus Christ of latter day saints, wasn't a prophet of God? They can't. In fact, the only real assurance that they have that they are correct is their safety in numbers. So we can say that faith with only one member is called a madman, a faith with only a few members is a cult, and faith with a significant number of followers is a religion.