The World Gold Council (WGC) said that Bitcoin, known as "digital gold", will never be able to replace gold, but they acknowledged that Bitcoin is enough to threaten the tools used by the Federal Reserve and other central banks, thereby affecting the entire economic system. Bitcoin ≠ Digital GoldIn its January investment research report (full text download at CoinWenKu), WGC pointed out that the price of Bitcoin increased 13 times in 2017, while gold increased by 13% in the same year. Despite this, the WGC believes that gold has more advantages in investment because cryptocurrencies are too risky.
The report comes as bitcoin prices experienced a sharp correction after a period of rapid growth, as tough regulatory measures in South Korea and India caused market panic. It’s worth noting that the WGC’s goal is to “stimulate and sustain demand for gold and become the industry leader and global authority on the gold market” — so it’s not surprising that they don’t support Bitcoin as an investment option. Bitcoin faces challengesOver the past year, the price of Bitcoin has risen by an average of 5% every day, which the WGC has criticized - they pointed out that this does not meet the definition of currency at all, let alone a store of value, and therefore Bitcoin is only suitable for investors seeking high returns. The report also pointed out that the sudden policies introduced by many countries around the world have made Bitcoin a dangerous investment, and this mainstream cryptocurrency will subvert the banking system.
The WGC also denied that rising demand for cryptocurrencies had caused a setback in gold prices, while stating that Bitcoin would suffer a devastating blow from other cryptocurrencies. Is Gold the Next Bitcoin?Although the WGC does not consider Bitcoin to be a stable investment, they believe that the underlying technology of cryptocurrency is promising and even plans to convert gold into digital assets in private chains.
It is clear that the WGC does not see Bitcoin as a viable alternative to gold. Whether gold can become a substitute for Bitcoin remains to be seen. |
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