Bitcoin Vs Gold: Is it even a contest?
Bitcoin Vs Gold: Is it even a contest?

By jordanjnr | Crypto Digest | 5 Dec 2019


If you find this post educative, entertaining or relevant,kindly leave a tip below to support my work. Thanks.

Bitcoin is usually referred to as "digital gold".

It has even been hinted that it might soon replace gold as an asset.

And for good reason.

It copies the limited nature of gold.(there are about 171000 tonnes of gold on the earth, and about 21000000 bitcoin that will ever be mined.)

It copies the mining process used to obtain gold.

It copies the high price tag of gold.

As we can see, Bitcoin is,in many ways,the digital counterpart of gold.

Except for one teeny weeny problem.

Bitcoin is about 10x more volatile than gold,even as it has settled down.

You see, that's the major mantra of Cryptocurrencies.

Their volatility offers investors a quick profit(or loss).

And this is one of the many reasons why Bitcoin cannot replace gold.

Because it poses a threat to investors' money.

And investors don't like that one bit.

See,gold is pretty stable.

Moves about 1% a year.

Bitcoin? It once moved 42% in a day,and has,since its inception,moved over 53000%.

That's pretty amazing in itself.

But you know you can expect 1% a year from gold. There's no telling what Bitcoin would be doing in the next hour or so,not to talk about in a year.

Also,Bitcoin can't replace gold just yet because it is yet to be considered as a currency by a majority of people.

Believe it or not, we spend gold everyday. We just don't know it.

In fact,until President Nixon removed the dollar of the gold backed standard some decades ago,the dollar was backed by gold.

That meant that for every dollar you spent,you were actually spending a tiny little piece do gold.

That gave the dollar the power it still has today.

But this isn't about the dollar.

Bitcoin follows a decentralised pattern of operations.

This means it really isn't backed by anything.

So it's not considered real money.

At least not yet.

But there's a ray of hope shining down on bitcoin.

As we have noticed of late,its volatility has been dropping slowly.

It still makes massive moves,but not like its 10% a day, everyday like it did yesteryear.

Slowly,but surely, Bitcoin is becoming a currency accepted by everyone.

There are bitcoin ATMs now,and stores like eazyskins support Bitcoin payouts.(This particular one was a big break,since this company recently received the queen's award for creativity).

Bitcoin will gain general recognition,and may eventually even replace gold entirely.

But for now,Bitcoin can't be compared to gold.

It just isn't a contest.

If you find this post educative, entertaining or relevant,kindly leave a tip below to support my work. Thanks.

Please comment your thoughts down below. Let's continue the discussion!


jordanjnr
jordanjnr

Hello! I am a Blockchain enthusiast,bitcoin investor,CEO of BigTycoon group and I love crypto! Hit me up @TycoontechBlog on twitter!


Crypto Digest
Crypto Digest

Daily crypto news, updates and possible price fluctuation directions sound good to you? You're in the right place if that's the case. Please, always remember that we are not analysts....do your own research!

Send a $0.01 microtip in crypto to the author, and earn yourself as you read!

20% to author / 80% to me.
We pay the tips from our rewards pool.