2020-2-9 19:23 |
Bitcoin completed its first decade with a mind-boggling 9 million percent increase in value, becoming the best performing asset of the decade. Also, Bitcoin’s value in gold rose significantly amidst the heightened global economic uncertainty.
Leading crypto exchange Coinbase which is set to cross 1 billion BTC in its storage topping any other exchanges’ holding in its latest blog says,
“Gold, and bitcoin, are safe havens from fiat currency devaluation, which historically tends to be incited by surging government debt.”
Bitcoin Armed and ReadyRecently, Coinbase CEO Brian Armstrong also recommended people to “consider crypto” in response to CBO projecting US national debt to rise to 98% of GDB in the next 10 years.
Though today people still think of crypto as “funny money” and a speculative asset class, this perspective will flip that will have millennials seeing the government's currency as “funny money” and crypto as the “real money” that people can’t tamper with, said Armstrong.
“Why put your livelihood into something that could be manipulated or devalued without your input,” he said last week.
Now, Coinbase is emphasizing on “Bitcoin is a store of value to rival gold in the digital age,” which is armed with technological advantages, accelerating development and maturing global market.
The peer-to-peer network already has several advantages over the precious metal in terms of scarcity, auditability, privacy, portability, divisibility, and low fees.
Bitcoin is scarce like gold and has a special property tooUnlike gold and bitcoin, fiat money doesn't have a fixed supply. The US dollar has lost over 96% of value since 1913 when the Federal Reserve took over the US banking system. Fed also has the power to generate more money “to satisfy political goals” but
“printing money has a hidden cost for all citizens, as new supply dilutes the value of existing stock.”
During this time, however, the gold price has risen from about $20 to more than $1,500 today. This is because governments can’t simply produce more. The bullion comprises only 0.00000031% of the Earth’s crust and
“there is an inverse relationship between elemental scarcity and commodity value.”
But Bitcoin not only has this scarcity but has a special property as well — it can be transported over a communications channel.
Not to mention, with the upcoming halving the stock to flow of bitcoin (will double to 50 from current S2F50) is going to be closer to gold’s 62, which is higher than any other metal commodity and the flagship cryptocurrency is “set to soon follow.”
Due to its scarcity, gold is a historic store of value and now Bitcoin with its volatility dampening over the years and adoption rising is also becoming a new-age store of value.
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