Gold Versus Bitcoin: The Pro-Gold Argument Takes Shape

Tuesday, November 21, 2017
By Paul Martin

By: GoldCore
GoldSeek.com
Tuesday, 21 November 2017

– Gold versus Bitcoin: The pro-gold argument takes shape
– Why cryptocurrencies will not replace gold as a store of value
– Similarities between crypto and gold but that does not make them substitutes
– Gold remains a highly liquid market, cryptocurrencies continue to be fragmented and difficult to spend
– Bitcoin does not make it an effective hedge against stocks

This weekend saw bitcoin shoot up over $8,000 and Bloomberg covered how some preppers were turning to bitcoin over gold. Does this mean it’s all over for gold? Is it set to be supplanted as a safe haven by crypto currencies?

Hardly. People read such information and continue to believe that gold and cryptocurrencies are substitute assets. They are not. So why are they so often pitched against one another?

Bitcoin and its contemporaries clearly have a role to play, the volume of demand demonstrates this and the technology is powerful. But, that role is not as a replacement for gold as a store of value.

Risk Hedge sums it up saying:

“Despite what the crypto-evangelists will tell you, digital tokens will never and can never replace gold as your financial hedge.”

Risk Hedge provided a great summary of the major flaws and differences in the gold versus crypto debate and the six reasons are listed below.

#1: Cryptocurrencies Are More Similar to a Fiat Money System Than You Think.

The definition of “fiat money” is a currency that is legal tender but not backed by a physical commodity.

Since the United States abandoned the gold standard in the 1970s, this has been the case with all major currencies, including the US dollar.

Ever since then, US money supply has kept increasing, and so has the national debt. In contrast, the dollar’s purchasing power has been on the decline.

Take a look at this historical gold price chart.

The Rest…HERE

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