Bitcoins are a type of digital currency. Records of transactions are maintained and new money is generated by a computational solution of mathematical problems. Bitcoins are also decentralized and operate independently without interference from the central bank. Lately, more and more people are beginning to invest in Bitcoin with the hope of getting more returns.
According to a survey, Bitcoin and gold have become enormously correlated with their values rising and falling at or around the same time. Furthermore, current statistics show that the two assets are indicating similar characteristics in their price charts.
The reason why bitcoin has managed to stand out compared to the other digital coins is that with the current market statistics, Bitcoin is referred to as “digital gold” or “gold 2.0.” This has encouraged more people to trade bitcoins through online platforms such as nakitcoins.com with some considering the coins as a safe haven.
Some of the similar traits between bitcoin and the precious metal include:
· Both gold and bitcoin are viewed as “alternative investments” by Wall Street.
· Similar to how gold is seen as the king of precious metals, Bitcoin is also the most trusted and valued cryptocurrency.
· In several years to come, the supply growth of gold and bitcoin will slow down to a fixed amount.
· Both have a limited supply that slowly increases over time as a result of "mining."
· Gold and bitcoins have similar monetary characteristics under bitcoin's original vision and gold's history.
Should You Buy Gold or Bitcoin?
With gold and bitcoin having several similar characteristics, it is challenging to decide on whether to purchase bitcoins or the precious metal. Here are some of the significant differences between gold and Bitcoin that can help you make the right decision.
Bitcoin is more volatile compared to gold. As the value of bitcoins increases, more people begin investing in them. Strong confidence from buyers further results in wild price swings, which makes it more preferred than gold. Recently, a team of analysts has been dedicated to exploring current issues facing Bitcoin and other cryptocurrencies.
According to research, it is effortless to get money for gold compared to bitcoins. A limited number of exchanges and flat withdrawals impose daily limits, which make bitcoins less liquid. Also, unlike bitcoins, most people worldwide are willing to pay for gold.
Transparency, Safety, and Legality
Gold’s established system for trading, weighing, and tracking is pristine. This means that it is tough to steal gold or trade off fake gold. On the other hand, bitcoin has an encrypted system and sophisticated algorithms, which makes it difficult to corrupt. However, the infrastructure to ensure that the bitcoins are safe is not in place. This has seen bitcoin users lose up to $460 million without a trace. Despite the numerous efforts made, bitcoin is still difficult to track and trace.
Gold is physically useful in making jewelry, unlike bitcoins, whereby its applications are not precise. Currently, bitcoins are used as a digital instrument of speculation and value transferability. Nonetheless, it is difficult to purchase items using bitcoins, and it has a limited utility like currency.