In the world of economics, many financial analysts have predicted a recession in the past year. Investors have become much concerned about searching for a safe and stable mode of investment after experiencing a bull market previously. The older move is being initiated as a fence against the gold with stock volatility. Although it has incurred good results in the past, now by testing the newer method, it will be going to pose a challenge against the traditional safe haven. Today, we are going to discuss the Bitcoin vs gold and which makes a better entity for purchase.
In the new era of the financial world, Bitcoin made its debut in the year 2009. It is credited for establishing the new era of digital currency, which has now become a global phenomenon. Bitcoin, the first cryptocurrency, became popular because it came equipped with some useful features that made it a safe haven. Well, it all depends upon the investor to classify whether it really lives up to its status of safe haven in times of fluctuation in the market. However, because of the popularity, people are much interested to know about Bitcoin price prediction in the future.
While discussing the Bitcoin vs gold, it is essential to know some factors that make gold a worthy safe haven. No doubt, it is a precious entity in terms of goods such as jewellery and other items. Besides being a scarce material, the supply of gold is low despite much demand. It is impossible to manufacture gold akin to new shares of the company or printing of money by banks. This valuable item is dug up from the ground and goes through processing.
The performance of gold is always seen during its modifications. The reason for this is because even if it fails to rise it remains stable, whereas other falls. This makes gold useful as a fence. Adding to it, the price of the gold rise when people prefer to invest in it by fleeing the stocks.
Amid Bitcoin vs gold, some similar characteristics are observed between gold and the latter crypto coin. In the past, Bitcoin was even termed as ‘digital gold’.
The battle of Bitcoin vs gold can be seen as an example when the first time gold was overshadowed by Bitcoin in 2017. Now in the current year, 2020, the price of Bitcoin rise to $8,700.
Amid Differences, There Are Similarities Too
Now don’t think we are dragging away from our main topic which is based on Bitcoin vs gold. But amid differences, you must have knowledge about the similarity between these two valuable entities. Bitcoin akin to gold is also found in a limited amount. The total supply of Bitcoin tokens was limited to 21 million by none other than its founder Satoshi Nakamoto.
Another similarity to observe is the absence of the role of central banks and the government to issue both Bitcoin as well as gold. Now if you have analyzed the cryptocurrency well, then it is obvious that you must be familiar with the fact that Bitcoin is a decentralized currency that is generated by the miners through the collective power of computation.
A fair similarity which can be observed between the two is the impossible to speculate about who will get exhausted first, gold or Bitcoin. Dating back to historical times, gold has been finding its use in luxurious items like jewellery and other valuable items. Bitcoin comes as the best option when there is a lack of banking and traditional currencies. The cryptocurrency finds its best use for individuals for sending value globally at no fee.
Bitcoin Vs Gold
Now let us get back to our main subject which is based on Bitcoin vs gold. So let us know it clearly with the following factors. Before that let us tell you that Bitcoin price prediction in 2021 is estimated to reach $100K.
Hard To Steal
Stealing gold is not an easy task. It is even impossible to fake it or spoil the metal. Bitcoin too shares the same feature to some extent because of its encrypted and decentralized feature and complex algorithms. However, it lacks in infrastructure to provide complete safety.
Liquidity is another example of Bitcoin vs gold. Here also gold seems to have an advantage over Bitcoin. It is because of access to cash in exchange for gold in contrary to Bitcoin. The factors which make Bitcoin lack in liquidity factor is the limited number of exchanges that enable fiat withdrawal. Also, the market of Bitcoin is limited in comparison to gold which is referred worldwide by people.
It is very interesting to see the battle between Bitcoin vs gold. But since both are equivalent in their importance. Gold is many predecessors to Bitcoin, because it has its historical use, whereas, Bitcoin is a new concept of digital technology in the contemporary finance world. But competition doesn’t see any ages or how much old an entity is. A comparison between Bitcoin and gold is the best example. But amid differences, there is a similarity between these two entities in terms of rarity and who is going to get exhausted first. But if you want to know who supersedes whom, then gold comes out winner to Bitcoin in terms of liquidity and safety.