“As Bitcoin continues due North and crossing the $1-T market cap mark last wk, more investors are assessing the comparison between the #1 cryptocurrency and an equally well-known asset class: Gold” — Paul Ebeling
Both assets are often seen as ways to diversify a portfolio or as a hedge against paper money inflation brought about by unsustainable fiscal and monetary policies.
But, until recently, it was rare to see Street analysts, chief executives, or established investors seriously compare them.
Bitcoin, referred to as digital gold has been seen as a risky speculative investment for those looking to profit in the short term. Gold has always been considered a safe-haven asset, in my opinion that has changed in the last few wks.
Now, bitcoin’s rapid ascent to over $57,000 per coin, backed by new investments from institutions, has led me and many others to question whether old assumptions about these assets are correct.
Given digital currencies’ climb, we surveyed 10 experts to see if they would rather hold bitcoin or gold for the next 10 yrs, and why.
We asked bitcoin bulls, gold bugs, analysts, executives, and more, the story is mixed. But my choice is clear, hold some of both.
Bitcoin is a 100X improvement over gold as a store of value. The world is realizing this and beginning to reprice digital currency in real-time. And although bitcoin has increased a huge amount in the last few months, it will continue appreciating in USD terms over the coming years.
I believe that bitcoin’s market cap will surpass gold’s market cap by 2025. For this reason, we are advising our clients to devest all paper gold and buy physical gold in 1oz bars at 3-5%, store at home in a safe to use a money incase of a major Black Swan event. And to add digital assets to portfolios’ of 12-15%
My Analysis Summery
Bitcoin is and will continue outperforming Gold overall.
Bitcoin was launched in Y 2009 by Satoshi Nakamoto who’s true identity remains unknown.
According to Satoshi’s Whitepaper, Bitcoin promises to be the 1st purely peer-to-peer version of electronic cash without having to rely on any financial intermediary.
Like Gold, there is a limited amount of Bitcoin.
Programmed in the source code, there are a limit of 21-M tokens as well as halving events, which reduce the supply of Bitcoin by 50% ensuring that the final Bitcoin will not be issued until about Y 2140.
Through an innovative incentive structure miners compete in solving a math problem and get rewarded in Bitcoin securing the network and verifying transactions in the process.
Bitcoin has inherent advantages over gold, advantages unique to today’s fast-paced electronic world that will enable Bitcoin outperform Gold for a long time to come.
Bottom line: the ways to buy Gold are mature, efficient, and stagnant; the ways to buy Bitcoin are expanding rapidly in both methodology, size, and number of participants. Advantage Bitcoin.
Have a prosperous week, Keep the Faith!