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Even if the gold price falls below the bottom once in 30 years, such as the 9.27% drop in April 2013, the gold bulls will not regret it. For them, gold is the only "real" currency in this world where central banks print fiat currency and depreciate more and more. I am afraid that no one else would have such a deep obsession except themselves.
The only ones who can come close are probably the fanatical supporters of Bitcoin. These "geeks" believe that decentralized digital currency is the ultimate way to transfer wealth at will, bypassing central authorities, intermediaries and central banks. Bitcoin is simply a paradise for libertarians.
With the BIP 91 expansion proposal receiving support from 93.8% of Bitcoin miners last Friday (July 21), exceeding 80%, the BIP 91 expansion proposal was officially locked in, and the risk of Bitcoin hard fork continued to decrease.
On the day the news was announced, Bitcoin once reached $2,949, close to the record high of $2,999 on June 11. Comparison of Bitcoin and Gold Growth Since the U.S. Presidential Election in November Although Bobby Lee, CEO of Bitcoin exchange BTCC, said it was too early to say that the darkest period was over, "we have reached an important milestone on the road to Bitcoin expansion, and there will be more milestones in the future."
Gold and Bitcoin enthusiasts have two things in common: they are all seeking a completely independent ultimate means of storing value, and their common enemy is the central bank. Do you think they are best friends? That's a big mistake!
In fact, the relationship between the two groups is more like a cat-and-dog fight - even if they sit at the same table, they will probably start to fight in a short while. Comparison 1: Is it visible and tangible?
Older investors like "Chinese aunties" are particularly fond of gold, especially physical gold, and they are not too fond of too much gold bars and coins. For them, Bitcoin is not only invisible and intangible, but they also think it is an illusory thing created by a bunch of young people in jackets to get high.
Bitcoin is often compared to gold in the market because they are the only two decentralized currencies that have been widely popularized among the people. Unlike legal tender such as the US dollar and the RMB, gold and the RMB do not require the existence of a central authority to guarantee their issuance and circulation.
Neither Bitcoin nor gold can be “printed” by central banks, which reassures conspiracy theorists who feel insecure. To obtain Bitcoin and gold, you either have to mine them—Bitcoin also has to be “mined,” but instead of pickaxes and shovels, you use computers—or you have to buy them.
But for gold bulls, nothing can replace the tangible gold that they can see and touch.
Bitcoin? To them, Bitcoin is just another bubble born on the Internet.
Comparison 2: Will it remain standing until the “end of the world”?
It is human nature to be skeptical about emerging technologies that claim to change the world but that we don't fully understand, and this is especially true as a rational investor.
A gold coin is just a gold coin, no gimmicks are needed. It is shiny and heavy, and you feel it is reliable when you hold it in your hand. You can't help but feel that this small gold coin exudes value and eternal light.
A gold investor once said,
“I prefer gold, the currency that has stood firm and unshakable in all countries of the world for five thousand years, to a line of code on the Internet.”
This statement is irrefutable. To put it bluntly, gold does not have the possibility of "failing miserably" like Bitcoin. If the worst "doomsday scenario" occurs, as long as the power and Internet are cut off, "geeks" will basically lose the ability to use Bitcoin.
The gold coins will still be kept in the pockets, accompanying the survivors to survive in the apocalypse.
However, the world is also quietly changing, and gold, which has stepped down from the altar, is gradually moving away from the center of the investment world.
Gold is indeed the cornerstone of the gold standard monetary mechanism for thousands of years; but for human information communication, paper and pen were also once an indispensable component. Literary youth like to say, "The days of the past have become slower/Cars, horses, and mail are slower/A lifetime is only enough to love one person", which is about the time when people once relied on wild geese to communicate with each other. But the new generation today may never use paper and pen to write a letter in their lifetime.
After all, most of the gold bulls are an aging generation in the population structure. As time goes by, the new generation who rely more and more on the digital world will become the mainstream of society. Will the appeal of gold as a physical wealth also gradually decline? Only time will tell.
Comparison 3: How difficult is it to accept?
The biggest obstacle to Bitcoin's large-scale acceptance by the public has always been that you simply cannot explain to a passerby in 30 seconds what Bitcoin is.
Most so-called fintech (financial innovation) have this problem, and this problem continues to this day without any improvement.
Of course, you can just use the cool-sounding term "digital currency" to cover everything and get away with it. But it's not that easy to explain the basic principles of blockchain and what distributed ledger technology is all about. It is really difficult for a person with an average education level to understand blockchain technology, digital currency payment system and smart contract system, and the revolutionary significance they bring to our centralized financial system.
People often confuse the terms Bitcoin, digital currency, and blockchain; while these three terms have something in common, they are also completely different concepts.
In short, Bitcoin is a digital currency based on blockchain technology.
There are already hundreds of digital currencies on the market. They vary greatly in economic effectiveness and usage, but they all use the blockchain technology pioneered by Bitcoin to a greater or lesser extent.
To put it bluntly, the word "currency" in the word "digital currency" is easy to cause misunderstanding, because many of the current "digital currencies" are actually similar to equity, providing holders with economic ownership of a specific commercial blockchain. "All crows are black", people tend to classify digital currencies as the same, but forget that there are 1,061 listed companies on the Shanghai Stock Exchange, and each one has its own calculations.
The ultimate question: Should I hoard Bitcoin or gold?
Gold vs. Bitcoin, to put it bluntly, is a comparison of assets under two different value assessment systems.
If you want to know which one will still be widely used a hundred years later, it must be gold. For thousands of years, only gold has been recognized as a medium of exchange and a means of storing value worldwide, and Bitcoin may find it difficult to do so in the future.
Gold does not rust. Gold is gold. As long as you own it, it will not go anywhere. You do not need to maintain an Internet connection or a computer to trade it. This is the value of gold as a tangible asset. Bitcoin, on the other hand, is based on a blockchain protocol that can be modified and changed. This hard fork crisis is a great example. In just a few months, rather than a few years, the expanded Bitcoin will look very different, and the valuation of Bitcoin will also change dramatically.
If you want to own an asset that you can keep in the bottom of a box for a long time without touching it, physical gold will certainly not "run away" on its own, but for digital currencies such as Bitcoin, there will always be similar concerns.
But if you ask me which asset is more likely to increase in price by 1,000% in three years, the answer will definitely be Bitcoin rather than gold. After all, the current total market value of Bitcoin is only US$45 billion, and there is still a lot of room for growth.
Gold, as a means of storing value, has survived many vicissitudes and has always been prosperous. For this reason, it is also worthy of inclusion in your multi-asset investment portfolio. Bitcoin, on the other hand, is still the "sun at six or seven o'clock" and has just risen.
Bitcoin and the blockchain technology behind it represent the development direction of the future financial system. If you are an investor who cares more about future expectations and grasping market trends, digital currency may be the next trend. This article comes from the paid column "Editor's Selection" of Wall Street Journal. Reproduction without permission is prohibited.
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