Bitcoin Cryptocurrency

Gold Vs Bitcoin2 min read

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Bitcoin has had an amazing year so far, rising from $1000 to almost $6000 at present rates. This coupled with the fact most of its biggest holders are hoarding the cryptocurrency (betting that it will only rise further in value) has triggered the debate on whether it will one day replace bullion gold as the ultimate store of value

Goldman Sachs one of Bitcoin’s harshest critics is of the view that gold is the asset of choice not by accident. That though Bitcoin has seen tremendous growth this year alone compared to gold’s modest 12% appreciation over the same period, it is gold and other precious metals that will continue to be the ultimate store of value due its intrinsic quality. These qualities include;

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Tangible Durability

Gold has the durability advantage over bitcoin in that it is not susceptible to hacking through networks like the cryptocurrency which can be stolen from online wallets smart phones and personal computers. And the lack of a standard regulation also means that it is exposed to dangers should world governments come to agreement to ban it or impose severe restrictions on the industry.

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Inherent Value

The precious metal is in limited supply and cannot be imitated unlike bitcoin, which though has a finite number of 21 million, several imitations and rivals have sprouted up like Ethereum which is touted to eventually replace Bitcoin as the ultimate cryptocurrency. Gold on the other hand has reigned supreme for millennia and is unlikely to face such problems.

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Stability

Gold is a much more stable store of value compared to the extremely volatile market of the cryptocurrency which Bitcoin leads. Gold steadily maintains its purchasing power while the cryptocurrency is highly susceptible to volatility as the world has yet to decide on what would be the legal framework of its continued existence.

 

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