The Question Is Should You Buy Gold Or Bitcoin? – Part 2

This is the continuation of the previous post citing the evidence for investing in bitcoin rather than the gold. Look into the intricacies of bitcoin investment. 

Comparing the Two

There has been for hundreds of years that gold has dominated the safe-haven asset arena while bitcoin was launched just over a decade ago and has only achieved widespread recognition in the last few years. It is, therefore, necessary to compare these two investment options thereby head-to-head.

1. Transparency, Safety, Legality

Henceforth gold’s established system for trading, weighing, and tracking are pristine as it’s very hard to steal it, to pass off fake gold, or to otherwise corrupt the metal. Here the bitcoin is also difficult to corrupt thanks to its encrypted decentralized system and complicated algorithms whereas the infrastructure ensures its safety which is not yet in place whereas the Mt. Gox disaster is a good example as to why bitcoin traders must be wary where the disruptive event is a popular exchange that went offline and about $ 460 million worth of user bitcoins that went missing. Hence many years later, the legal ramifications of the Mt. Gox situation are still being resolved whereas legally there are a few consequences for such behavior as bitcoin remains difficult to track with any level of efficiency. 

2. Rarity

Thereby both gold and bitcoin come as rare resources while the halving of Bitcoin’s mining reward ensures that all 21 million Bitcoin will surely be out in circulation by the year 2140. Hence while we know that there is only 21 million bitcoin that exist, it is also unknown when all the world’s gold will be mined from the earth. Hereby there is also speculation that gold can be mined from asteroids and there are even some companies looking to do this in the future. 

3. Baseline Value

Thereafter gold has historically been used in many applications where from luxury items like Jewellery to specialized applications in dentistry, electronics, and more comes additionally ushering in a new focus on blockchain technology as bitcoin itself has tremendous baseline value as well. Thereafter billions of people around the world lack access to banking infrastructure and traditional means of finance like credit. Hereby with bitcoin, these individuals can send value across the globe for close to no fee. Thereby bitcoin’s true potential as a means of banking for those without access to traditional banks has perhaps yet to be fully developed.

4. Liquidity

In this context, both gold and bitcoin have very liquid markets where fiat money can be exchanged for them.

5. Volatility

Thereby one major concern for investors is by looking toward bitcoin as a safe haven asset is its volatility. Thereby one needs to look only to the price history of bitcoin in the two years of evidence, whereby the highest point around the beginning of 2018 the bitcoin reached a price of about $ 20,000 per coin. While about a year later, the price of one bitcoin hovered around $ 4,000 as since then it recovered a portion of those losses but is nowhere near its one-time high price point. Thereby the overall volatility of bitcoin has historically proven itself to be subject to market whims and news that is particularly as the cryptocurrency boom swept up several digital currencies into record-high prices around the end of 2017 with the news from the digital currency sphere is that it could prompt investors to make quick decisions sending the price of bitcoin upward or downward quickly, and hence the volatility is not inherent to gold for those reasons mentioned above and thereby making it perhaps a safer asset.

The Final Words To Conclude The Discussion

Therefore, in recent years several alternative cryptocurrencies that have been launched which aim to provide more stability than bitcoin. For instance, the tether is one of these so-called stable coins linked with the US dollar in much the same way that gold was before the 1970s. hereafter investors look for less volatility than bitcoin that many wishes to actually look elsewhere in the digital currency space for safe havens.

Hence it is up to the investor to make the choice diligently. Here gold outperforms bitcoin in its ease to access. Hence the bitcoin remains the tech-savvy enthusiasts’ mode of investment. We complete the discussion here and it helps you decide which one overtakes the other in the race to economic independence and investment ability. Finally, it is not the investment that matters but the ease to deposit the money through safe and secure transactions. Until the next time we sign off with this writeup. 

What's Your Reaction?