A leading financial magazine has recently tagged Bitcoin as a “digital gold,” which has made numerous headlines. Billionaire investor Mike Novogratz also unanimously agreed to the statement published in the magazine and added, “Bitcoin is like digital gold and won’t be used in the same way as traditional currency for at least the next five years. Bitcoin is being used as a store of value.”
From being just a risk-on speculative asset, Bitcoin is on the verge of transforming into a quasi-currency like physical gold. In this regard, the financial magazine quoted, “Increasing futures open interest, declining volatility, and relative outperformance despite the stock-market shakeout indicate Bitcoin is maturing from a speculative crypto-asset toward a digital version of gold.”
Bitcoin is more like a commodity than it is a currency. Moreover, BTC is not issued by any centralized organization, and as such, it is not guided by any monetary policies; therefore, Bitcoin is different from fiat currencies. Though BTC is called a virtual set, it has many similarities with physical gold. Let us find out how.
Similarities Between Bitcoin and Gold
- Both gold and Bitcoin are finite resources and have a limited supply.
- Both gold and Bitcoin cannot be forged. Even though there are artificial gold products in the world, they can be easily identified as artificial. Similarly, with Bitcoins also, any forging done can be easily identified by the blockchain technology.
- Both gold and Bitcoin retain their original values even if they are split.
- Both gold and Bitcoin do not deteriorate in storage even though their prices may fluctuate at any time. This makes both the assets suitable for storing value.
- For mining both the assets, there is some mining cost involved.
Therefore, with all these striking similarities between gold and Bitcoin, investors are eying on an alternative investment during this pandemic. They are seeking such an investment that does not only serve as a long-term investment but can also be liquidated, and Bitcoin stands as a strong case here.
Following the pandemic, when all other cryptos are showing a downward sign, Bitcoin is gaining value as more and more people are showing interest in adding Bitcoins to their portfolios. Even several banks and credit card companies have started following the footsteps of one of the leading payment gateways, PayPal, which allows users to transact in cryptocurrencies.
As such, millennial investors who are not experts in the real-time financial markets find Bitcoin as easier alternatives that are fast, reliable, and outwardly safe. You can invest in Bitcoin from Bitcoin Code to get the maximum rewards from Trading. To get more details on this innovative and automated trading platform check Bitcoin Code Reviews.
But Is Bitcoin Really a Digital Gold? Let us find out
Bitcoin appeals to the emerging cashless economy
The inherent features of Bitcoin, like price transparency, no third-party interference, etc., help Bitcoin to benefit the cashless economy as digital gold.
Bitcoin can be used as a hedge asset
Gold is now considered as a safe haven of the past, which is now being replaced by automated assets like Bitcoin, which again proves Bitcoin to be digital gold.
Hence, global central banks have already started creating their own digital assets to cope up with the currency printing complexities during the pandemic. China is already testing a digital ‘Yuan’ to keep up the pace.