As Bitcoin continues to gain traction, investors have started assessing it as a viable long-term investment option. Some of them have also started comparing it to gold and wondering if Bitcoin can replace gold as a prime investment asset and commodity. There are arguments to be made either way and we are going to look at these arguments to see which is the better option between Bitcoin and Gold.
Gold has been used to store value for thousands of years while Bitcoin has been around for just over a decade. Because of this, some investors might not trust Bitcoin as much as they do gold and if you are looking for an asset that has been around for so long that everyone understands it, gold might be the better option for you.
Gold is accessible to all people regardless of their economic background or standing. Because of how accessible it is, gold has been used as the main currency of central banks around the world. Bitcoin, on the other hand, seems to be accessible only to those who fully understand it, with most other people sceptical of it or not knowing about its existence. However, cryptocurrency exchanges are making Bitcoin accessible even to those who do not understand it. The popularity of Bitcoin and the continued mentions in the news and other mediums means that more people are coming to know about it.
There is no doubt that Bitcoin is a very volatile asset or commodity. It has experienced huge price swings over the past few years, with people losing and making thousands of dollars every time Bitcoin’s price swings one way or the other. Gold holds its value very well and its price can even increase during times of uncertainty or economic downturns. Gold can also recover its price after a downturn but no one knows how many swings Bitcoin can undergo before its price crashes, although such a scenario is far from likely.
Selling and Buying
It is very easy to buy gold. Sellers like Nuggets By Grant purchase and sell gold in different forms including nuggets and bullions. You can also purchase gold as dust or jewellery from other sellers. If you would not like to hold physical gold, you can always invest in a fund or EFT. As for Bitcoin, all you need is an exchange and a bank account. Using both of these, you can buy and sell Bitcoin or even invest in a Bitcoin investment fund, or Bitcoin ETF. Because it takes a lot more physical effort to purchase and sell physical gold, Bitcoin does edge out gold, but by very little.
Gold and Bitcoin are very similar in that they are both limited in supply, widely accepted, can easily be sold and bought, and are viewed as a way of storing wealth. When deciding on which of the two to invest in, it would be best to look at other factors such as longevity, volatility, how much you trust the asset and the return on investment you get. While Bitcoin can make you a lot of money very quickly, its volatility means it can lose you a lot of money too. Gold, on the other hand, is a lot more stable, has been around for longer and is so trusted that even central banks use it as a currency.