Investors have always compared Cryptocurrency to gold since they appear to have a lot in common. They are both produced through mining, impossible to destroy and they are also profitable but are at risk of cost fluctuations. In addition to that, they are also exchanged for fiat currencies or an equivalent. The Russians have also launched GoldMint platform which operates on digital assets just like Bitcoin. However, some investors have different perspectives of the two investments.
Willy Woo recently took to tracking cryptocurrency’s success by comparing gold’s performance with bitcoin over the past 10.7 years . This analysis shed light on the investment in gold as compared to that of bitcoin. According to Woo, an investment of $1 of a bitcoin that was made in 2009 is currently good enough to buy a yacht today, but an investment of the same dollar that was put into gold is equivalent to a chocolate bar today. In short, Bitcoin has gained over the years that a $1 investment is now worth $12.8 million while the same dollar investment in gold is now worth $1.66.
In his comparison, he depicted that as much as gold and bitcoin had gained in 2020, Bitcoin was the best investment since it remains on top among other macro assets over the years. However, gold has not always been on the losing end. In 2011, gold had netted gains but later took a fall and only rose to its glory in recent months. Despite this fluctuations, gold has not lost its supporters, who ensure that they make a point of rubbishing Bitcoin. While Bitcoin supporters on the other hand have relentlessly denied that Bitcoin investment can be compared to gold. According to people like Peter Schiff, who is reported to be the most vocal gold bug , Bitcoin cannot be termed as gold’s digital counterpart.
The above comparison has brought a tough debate on which of the two (Gold and Bitcoin) was more successful. Roy Sebag , the founder and CEO of Goldmoney, defended Gold and disputed the Ammous’ idea that the fixed supply of Bitcoin would stay at 21 million. The author of “The Bitcoin Standard” Seifedean Ammous on the other hand, believed that gold would be demonetized over the years just like silver. He also pointed out that gold had failed its investors by failing to take advantage of the COVID- 19 fiat meltdown. According to Ammous, gold had its glory but times have changed, it was now time for Bitcoin to shine .
Image courtesy of Pixabay
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