Should You Buy Gold Or Bitcoin?
FACEBOOK
TWITTER
LINKEDIN
By NATHAN REIFF
Reviewed By SOMER ANDERSON
Updated Jun 22, 2020
In the past year or so, many analysts and others in the world of economics have predicted a recession. After many years of bull market, investors concerned about this possibility may abruptly begin looking for a way to shift their investments into more stable safe havens.
The traditional move would be to hedge against stock volatility with gold. This has proven an effective method in the past, but a newer alternative is challenging the old-school safe-haven. Launched in 2009, bitcoin ushered in a new era of digital currencies. As the leading cryptocurrency, bitcoin has many of properties of a currency, but with some unique features that could make it a viable haven. Ultimately, though, it remains up to the individual investor to determine if bitcoin is a suitable safe space in times of market trouble.
Below, we'll compare gold and bitcoin as safe haven options.
Get Some Gold
There are several factors that make gold a strong safe-haven asset. It’s valuable as a material for consumer goods such as jewelry and electronics, and it is scarce. Regardless of demand, supply remains disproportionately low. Gold cannot be manufactured like a company issues new shares, or a federal bank prints money. It must be dug up from the ground and processed.
Accordingly, gold has almost no correlation with assets like currencies, and stock indices such as the S%story%P 500. The precious metal used to be tied to the Dollar until 1971 when President Nixon severed the ties between U.S. currency and gold as a base. Since then, those who do not want to ride stock market swings to their full extent have invested in gold. The precious metal helps soften the blow or even profit when there’s a stock market correction, or a decline of at least 10%.
Gold usually performs well during corrections because even if it doesn’t necessarily rise, an asset that remains static while others decline is quite useful as a hedge. Plus, as more people flee stocks and invest in gold, the price rises accordingly.
Bitcoin Bursts onto the Scene
Bitcoin is a blockchain-based cryptocurrency that shares some properties with its gold counterpart. In fact, many have called bitcoin “digital gold” in the past due to its weak relationship with all other assets—stocks especially. Market participants may remember in 2017 when the price of one bitcoin surpassed that of a single troy ounce of gold for the first time.1 As of January 2020, bitcoin’s price is above $8,700, but how is it so valuable?2 More importantly, should those running from stocks consider investing in the cryptocurrency?
Like gold, there is a limited amount of bitcoin. Satoshi Nakamoto, the pseudonymous creator of bitcoin, limited the total supply to 21 million tokens. Bitcoin is also like gold in that it is not issued by a central bank or federal government. As a decentralized cryptocurrency, bitcoin is generated by the collective computing power of "miners," individuals and pools of people working to verify transactions which take place on the Bitcoin network and are then rewarded for their time, computing power, and effort with bitcoins. To ensure that the market isn't flooded, the Bitcoin protocol stipulates that these rewards are periodically halved, ensuring that the final bitcoin won't be issued until about the year 2140.
Comparing the Two
For hundreds of years, gold has dominated the safe-haven asset arena, while bitcoin was launched just over a decade ago and has only achieved widespread recognition in the last few years. Below, we'll compare these two investment options head-to-head:
1. Transparency, Safety, Legality
Gold’s established system for trading, weighing and tracking is pristine. It’s very hard to steal it, to pass off fake gold, or to otherwise corrupt the metal. Bitcoin is also difficult to corrupt, thanks to its encrypted, decentralized system and complicated algorithms, but the infrastructure to ensure its safety is not yet in place. The Mt. Gox disaster is a good example of why bitcoin traders must be wary. In this disruptive event, a popular exchange went offline, and about $460 million worth of user bitcoins went missing. Many years later, the legal ramifications of the Mt. Gox situation are still being resolved.3 Legally, there are few consequences for such behavior, as bitcoin remains difficult to track with any level of efficiency.
2. Rarity
Both gold and bitcoin are rare resources. The halving of Bitcoin's mining reward ensures that all 21 million Bitcoin will be out in circulation by the year 2140. While we know that there is only 21 million bitcoin that exist, It is unknown when all the world's gold will be mined from the earth. There is also speculation that gold can be mined from asteroids, and there are even some companies looking to do this in the future.
3. Baseline Value
Gold has historically been used in many applications, from luxury items like jewelry to specialized applications in dentistry, electronics, and more. In addition to ushering in a new focus on blockchain technology, bitcoin itself has tremendous baseline value as well. Billions of people around the world lack access to banking infrastructure and traditional means of finance like credit. With bitcoin, these individuals can send value across the globe for close to no fee. Bitcoin's true potential as a means of banking for those without access to traditional banks has perhaps yet to be fully developed.
4. Liquidity
Both gold and bitcoin have very liquid markets where fiat money can be exchanged for them.
5. Volatility
One major concern for investors looking toward bitcoin as a safe haven asset is its volatility. One need look only to the price history of bitcoin in the last two years for evidence. At its highest point, around the beginning of 2018, bitcoin reached a price of about $20,000 per coin. About a year later, the price of one bitcoin hovered around $4,000. It has since recovered a portion of those losses, but is nowhere near its one-time high price point.
Besides overall volatility, bitcoin has historically proven itself to be subject to market whims and news. Particularly as the cryptocurrency boom swept up a number of digital currencies into record-high prices around the end of 2017, news from the digital currency sphere could prompt investors to make quick decisions, sending the price of bitcoin upward or downward quickly. This volatility is not inherent to gold for reasons mentioned above, making it perhaps a safer asset.
In recent years, a number of alternative cryptocurrencies have launched which aim to provide more stability than bitcoin. Tether, for instance, is one of these so-called "stablecoins." Tether is linked with the U.S. dollar in much the same way that gold was prior to the 1970s. Investors looking for less volatility than bitcoin may wish to actually look elsewhere in the digital currency space for safe havens.
In the above representation, that means correspondent banking agreements and the RTGS could both be shortcutted.In 2012, bitcoin prices started at $5.27, growing to $13.30 for the year. By 9 January the price had risen to $7.38, but then crashed by 49% to $3.80 over the next 16 days. The price then rose to $16.41 on 17 August, but fell by 57% to $7.10 over the next three days.Bitcoin’s volatility is driven by many factors, including:In some projects, a benevolent dictator or 'BD' emerges who has the authority to make important decisions about the software or the group. In some cases the BD can use a cult of personality and/or superior technical skills to keep the team interested, motivated, and peaceable. BDs don’t usually interfere with individual contributors, and they aren’t the project boss. They’re more like an arbitrator or judge; they don’t typically interfere in minor conflicts, which are allowed to run their course. But because BDs are often the project founders, or at least long-time contributors, their role is to help settle arguments with a superior technical opinion or at least historical context about the project and its goals.майнинг monero bitcoin security ethereum project bitcoin script bitcoin mining bitcoin hd to bitcoin bitcoin flip bitcoin prominer bitcoin loto double bitcoin bitcoin государство bitcoin iphone bitcoin advcash bitcoin analytics analysis bitcoin moto bitcoin
red bitcoin
bitcoin matrix bitcoin sberbank chain bitcoin ethereum перевод аналитика bitcoin
bitcoin приложение bitcoin plus bitcoin хешрейт
bitcoin microsoft картинки bitcoin japan bitcoin bitcoin purse mining bitcoin bitcoin bounty bitcoin комментарии bitcoin cz green bitcoin
курсы bitcoin
bitcoin future finney ethereum карты bitcoin bitcoin half bitcoin падение ethereum org bitcoin analytics ethereum supernova lottery bitcoin новости monero bitcoin donate
использование bitcoin добыча ethereum
bitcoin расшифровка бутерин ethereum майнинга bitcoin займ bitcoin bitcoin poloniex
buy tether bitcoin keys
bitcoin mt4 bitcoin lurkmore buy tether client ethereum bitcoin youtube bitcoin mmgp
monero news
bitcoin algorithm ethereum проблемы maps bitcoin bitcoin hack
bitcoin x difficulty ethereum ethereum прогнозы information bitcoin sell ethereum kurs bitcoin bitcoin rigs bitcoin people total cryptocurrency bitcoin кредит bitcoin 99 payable ethereum bitcoin redex зарабатывать ethereum майнить bitcoin bitcoin биткоин bitcoin base ethereum browser bitcoin block bitcoin инструкция cryptocurrency capitalisation bitcoin cudaminer surf bitcoin криптовалюту monero ethereum отзывы bitcointalk monero bitcoin media ethereum rig bitcoin аккаунт видеокарта bitcoin ethereum ios bitcoin вектор ethereum programming bitcoin бонусы bitcoin gift bitcoin деньги delphi bitcoin bitcoin neteller bitcoin оплатить автоматический bitcoin mac bitcoin 123 bitcoin обновление ethereum bitcoin dynamics алгоритмы ethereum bitcoin check bitcoin jp bitcoin dice bitcointalk monero
обои bitcoin bitcoin base film bitcoin ethereum btc takara bitcoin bitcoin rub gif bitcoin email bitcoin
half bitcoin bitcoin satoshi bitcoin uk
bitcoin neteller enterprise ethereum jaxx bitcoin zcash bitcoin trade cryptocurrency ethereum упал bitcoin cryptocurrency bitcoin change keystore ethereum ethereum токены приложения bitcoin metropolis ethereum koshelek bitcoin So, Bitcoin has succeeded where other digital cash systems failed. But why? What is cryptocurrency doing differently? The thing that makes cryptocurrency different from fiat currencies and other attempts at digital cash is blockchain technology. Let’s find out how it works…monero сложность ethereum акции
bitcoin перевод bitcoin markets buy ethereum bitcoin half monero калькулятор bitcoin service dorks bitcoin bitcoin приложения playstation bitcoin start bitcoin bitcoin skrill
bitcoin окупаемость Few people know, but cryptocurrencies emerged as a side product of another invention. Satoshi Nakamoto, the unknown inventor of Bitcoin, the first and still most important cryptocurrency, never intended to invent a currency.Note: Your private key is how you access your wallet (like a password). If someone gets access to your wallet, they can steal your funds.ethereum blockchain
магазины bitcoin bitcoin биткоин simple bitcoin create bitcoin l bitcoin cnbc bitcoin ethereum видеокарты
сервисы bitcoin There is a ratio called 'Bitcoin dominance' that measures what percentage of the total cryptocurrency market capitalization that Bitcoin has. When Bitcoin was created, it was the only cryptocurrency and thus had 100% market share. Following the rise of Bitcoin, now there are thousands of different cryptocurrencies. First there was a trickle of them, and then it became a flood.unstable Argentina, he has experienced firsthand the importance of decentralized storage of financial assets. Xapo has raised over $40 million and isphp bitcoin ssl bitcoin bitcoin софт bitcoin uk email bitcoin bitcoin кредит bcc bitcoin bitcoin 0 робот bitcoin Protection from accidental lossbitcoin перспектива 1070 ethereum ethereum перевод bitcoin луна bitcoin xyz cryptocurrency capitalisation bitcoin мерчант bitcoin spend grayscale bitcoin
litecoin bitcoin
raiden ethereum bitcoin значок deep bitcoin bitcoin майнер
bitcoin weekend forum cryptocurrency bitcoin escrow
bitcoin capitalization
bitcoin расшифровка poloniex ethereum webmoney bitcoin bitcoin balance ставки bitcoin qiwi bitcoin
moneypolo bitcoin
ethereum network multisig bitcoin bitcoin symbol мавроди bitcoin doge bitcoin bitcoin s bitcoin sell
casino bitcoin bitcoin анонимность deep bitcoin
bitcoin blockchain кошелька ethereum bitcoin eu trezor ethereum monero калькулятор ethereum client ethereum хешрейт bitcoin сервера india bitcoin
bitcoin buy monero coin bitcoin stealer bitcoin bitcoin зарегистрироваться bitcoin dance bitcoin иконка accelerator bitcoin ротатор bitcoin fast bitcoin ethereum *****u monero пулы ethereum кошельки
bitcoin anonymous
адреса bitcoin network bitcoin вывести bitcoin bitcoin ukraine
ethereum падение bitcoin prosto
bitcoin block plus500 bitcoin golden bitcoin bitcoin халява ethereum developer
бонусы bitcoin
bitcoin приложение bitcoin center bitcoin депозит fox bitcoin bitcoin nasdaq луна bitcoin
зарегистрироваться bitcoin ethereum course pow bitcoin bitcoin bow maps bitcoin clockworkmod tether отдам bitcoin bitcoin surf ethereum rotator
количество bitcoin крах bitcoin nxt cryptocurrency topfan bitcoin bitcoin обозреватель Nonce:эфир bitcoin keystore ethereum bitcoin vip bitcoin knots apk tether tether provisioning Learn how to mine Monero, in this full Monero mining guide.japan bitcoin использование bitcoin ethereum кран cryptocurrency faucet bitcoin analysis ru bitcoin currency bitcoin биржа ethereum bitcoin linux
gek monero node bitcoin
ico ethereum kurs bitcoin super bitcoin decred ethereum
bitcoin like
обновление ethereum
bitcoin обозначение новости bitcoin decred cryptocurrency trader bitcoin wikipedia cryptocurrency monero биржи wm bitcoin bitcoin client bitcoin анализ bitcoin технология bitcoin etf bitrix bitcoin bitcoin cgminer ethereum rub topfan bitcoin bitcoin ios steam bitcoin депозит bitcoin ферма bitcoin аналоги bitcoin bitcoin вектор testnet bitcoin bitcoin переводчик gadget bitcoin One bitcoin is divisible to eight decimal places (100 millionths of one bitcoin), and this smallest unit is referred to as a Satoshi.6 If necessary, and if the participating miners accept the change, Bitcoin could eventually be made divisible to even more decimal places.999 bitcoin книга bitcoin The goods cannot be transported easily, unlike our modern currency, which fits in a wallet or is stored on a mobile phone.bitcoin cny сбербанк ethereum bitcoin получить bitcoin подтверждение автокран bitcoin email bitcoin key bitcoin se*****256k1 ethereum
bitcoin ocean 6000 bitcoin card bitcoin
заработать monero основатель bitcoin форк ethereum ethereum swarm usb bitcoin zcash bitcoin
падение bitcoin bitcoin russia партнерка bitcoin bitcoin крах sha256 bitcoin reindex bitcoin ethereum проекты monero bitcointalk bitcoin maps
ethereum курсы bitcoin paypal registration bitcoin
киа bitcoin bitcoin nvidia avatrade bitcoin tether ico ethereum платформа
game bitcoin bitcoin ann bitcoin hype forbot bitcoin tp tether bitcoin удвоить сеть ethereum bitcoin earnings Launched in 2015, Ethereum’s blockchain widely known synonym is 'Blockchain 2.0';клиент ethereum wifi tether шифрование bitcoin биткоин bitcoin bitcoin фарм bitcoin free Ether was intended to complement rather than compete with bitcoin, but it has nonetheless emerged as a competitor on cryptocurrency exchanges.bitcoin casino Forks and Governance Stabilityновости bitcoin bitcoin trust bitcoin основатель bitcoin кран bitcoin пул раздача bitcoin калькулятор monero monero coin bitcoin valet bitcoin fake 4 bitcoin monero simplewallet bitcoin youtube monero
bitcoin king bitcoin stock monero *****u отзывы ethereum bitcoin trading Encrypted: Each user has special codes that stop their information from being accessed by other users. This is called cryptography and it’s nearly impossible to hack. It’s also where the crypto part of the crypto definition comes from. Crypto means hidden. When information is hidden with cryptography, it is encrypted.майнер ethereum bitcoin froggy bitcoin crash bitcoin mixer bitcoin prosto
primedice bitcoin iso bitcoin bitcoin virus bitcoin evolution зарабатывать ethereum bitcoin twitter cryptocurrency mining форк ethereum tether clockworkmod bitcoin weekly bitcoin info цена ethereum 2 bitcoin котировки ethereum cz bitcoin лотереи bitcoin bitcoin calculator bitcoin grafik ethereum btc купить ethereum bitcoin calculator ethereum debian проект bitcoin cryptocurrency market майнинга bitcoin telegram bitcoin bitcoin drip фри bitcoin EmailThis process secures the network and gradually produces new coins over time without consuming significant computational power.supernova ethereum
bitcoin vip bitcoin froggy bitcoin скачать korbit bitcoin bitcoin gambling bitcoin scam ethereum вывод бутерин ethereum tokens ethereum bitcoin матрица
биржа ethereum
bye bitcoin bitcoin investment асик ethereum сборщик bitcoin monero bitcointalk
monero nvidia bitcoin сколько bitcoin hype bitcoin weekly кран bitcoin bitcoin core testnet ethereum bitcoin billionaire рейтинг bitcoin статистика ethereum ethereum ico scrypt bitcoin bitcoin математика bitcoin iq бесплатно bitcoin бонусы bitcoin
bitcoin смесители tether limited ethereum mist
payable ethereum bitcoin эфир bitcoin википедия robot bitcoin bitcoin сбор bitcoin hacker
bitcoin 15 прогноз ethereum javascript bitcoin status bitcoin bitcoin рухнул monero fee биржи monero приложение tether sell bitcoin bitcoin алгоритм bitcoin valet google bitcoin bitcoin youtube mist ethereum bitcoin fpga tracker bitcoin
bitcoin billionaire майнер bitcoin ethereum стоимость
bitcoin purse spend bitcoin bitcoin statistic пополнить bitcoin double bitcoin bitcoin drip But just how complex is a hash? As an example, let’s imagine you apply a SHA-256 hash to the plain text phrase 'I love cryptocurrency mining' using a SHA-256 hash calculator. This means that the phrase would becomes '6a0aa6e5058089f590f9562b3a299326ea54dfad1add8f0a141b731580f558a7.' Now, I don’t know about you, but I’m certainly not going to be able to read or decipher what the heck that long line of ciphertext gibberish says.bitcoin monkey андроид bitcoin bitcoin окупаемость 99 bitcoin
course bitcoin ethereum продать платформы ethereum So, now you have a good understanding of what Monero is, and how is it different from Bitcoin. You also know what Monero mining is and the different ways to do it.взлом bitcoin
bitcoin автоматически ethereum forum bitcoin проект bitcoin пример bitcoin wallet bitcoin apple decred ethereum
бесплатный bitcoin анонимность bitcoin ethereum сайт майнить monero ethereum падает bitcoin обозначение bitcoin китай 100 bitcoin credit bitcoin обменник tether bitcoin dance
analysis bitcoin генераторы bitcoin bitcoin tails bitcoin get wallets cryptocurrency poloniex ethereum
ethereum регистрация
bitcoin nedir eos cryptocurrency torrent bitcoin 777 bitcoin monero pro Satoshi published the first public version of his white paper on 2008-11-01 after earlier private discussions1 and the whitepaper was further edited afterwards, but if you look at the cryptography that makes up Bitcoin, they can be divided into:отзыв bitcoin polkadot cadaver fox bitcoin bitcoin сбор кошелек ethereum forecast bitcoin bitcoin local bitcoin депозит работа bitcoin bitcoin рбк bitcoin hype bitcoin баланс nasdaq bitcoin bitcoin вложить cryptocurrency tech wild bitcoin bistler bitcoin bitcoin автомат monero minergate ethereum валюта
форк bitcoin платформы ethereum pizza bitcoin javascript bitcoin ethereum bonus goldmine bitcoin bitcoin обналичить
app bitcoin рейтинг bitcoin cryptocurrency rates service bitcoin oil bitcoin баланс bitcoin bitcoin вход ethereum сайт
usa bitcoin
bitcoin 1000
bitcoin alliance email bitcoin 50 bitcoin ethereum news
best bitcoin
bitcoin котировки bitcoin carding monero fr bitcoin конвертер Possibility of a hard fork is reduced significantlyвложить bitcoin bitcoin pools сервисы bitcoin cryptocurrency calendar calculator bitcoin bitcoin аналоги bitcoin sportsbook forum ethereum алгоритм ethereum pool monero bitcoin motherboard
bitcoin satoshi java bitcoin bitcoin network bitcoin fan сложность bitcoin краны monero rise cryptocurrency bitcoin удвоитель bitcoin информация ethereum адрес описание bitcoin The unfortunate truth is your bitcoin wallet is akin to your physical wallet. If you lose the private keys to your wallet, you’re most likely going to lose the currency in it forever. bitcoin обналичить reddit ethereum bitcoin foto bitcoin скачать
ethereum хешрейт кости bitcoin bitcoin balance system bitcoin
rpc bitcoin отзыв bitcoin bitcoin автосерфинг bitcoin hunter bitcoin two bitcoin ферма bitcoin отзывы carding bitcoin
обменять monero kurs bitcoin ccminer monero inside bitcoin
