Bitcoin Forum

Hello,

After watching this YouTube video

Bitcoin 101 - Modelling the Price of Bitcoin - Is a $100,000 bitcoin possible?

https://www.youtube.com/watch?v=g2nXgK34HIM

A question has raised a flag in my head.

Can Bitcoin surpass Gold ? Could it be used as (Store of Value) instead of Gold in the coming 5 - 10 years ?

Is it possible and probable ? Not even 100%, but like 20-50% ?

What do you think ?

It's very possible. Only time will tell.

Food for thought: Bitcoin is extremely scarce with a hard cap. It is infinitely divisible, extremely mobile, cost nothing to "transport" and takes up almost no physical space (other than the device used to send/receive).

There will ever only be 21 million bitcoins. There is over 50 million troy ounces of gold mined each year (current estimates are about 80 million troy ounces per year).


Essentially no store/merchant accepts gold coins/bars in exchange for goods. The number of places accepting bitcoin in exchange for goods/services has gone up dramatically over the past few years.

In 10 years I give Bitcoin a 20%+ chance of truly being a Gold 2.0.

In 20 years I give Bitcoin a 50%+ chance of being the new global reserve currency.

Thank you for your reply.

All what you said is true and makes sense.

I just have a question regarding this point


On what basis did you say 20%+ or it's just speculation ?

Thing about gold is that I might have 500 Million KGs on my backyard just waiting to be rigged up... Now if that would happen that gold would lose it value.

Most people cant grasp that the above two statements in bold completely contradict each other.

If there was only 1 bitcoin in existence but it is infinitely divisible it is not scarce.


Maybe not directly but I bet I could take a gold coin/bar to any country in the world and pretty quickly convert it to the local currency as needed to buy goods and services, try that with BTC

The fact that these BTC v gold threads keep popping up just goes to show its hard wired into people for some unknown reason that gold is special and the ultimate store of wealth.

Gold market cap roughly - $6,843,058,204,925
BTC market cap roughly - $......3,373,831,169

https://i.imgur.com/NhDaANk.png

Bitcoin has its place and will evolve over time but it will never surpass gold as a store of wealth.

I personally like this guy's argument on bitcoin versus gold: 

https://cdn.panteracapital.com/wp-content/uploads/Bitcoin-vs-Gold.pdf (https://cdn.panteracapital.com/wp-content/uploads/Bitcoin-vs-Gold.pdf)

I'll chime in later on my opinion.  But I must say most of my opinions are right in line with this guy I linked you to.

Comparing ounces of physical weight to infinitely divisible bitcoins is a bit arbitrary, don't you think?

The scarcity attribute is there, but it's difficult to compare with gold's long history of valuation spanning many thousands of years.

And OP -- 5-10 years? What's the hurry?

I guess it could one day, I mean who knows, in ten years gold might not have the shine (at current falling rate) and bitcoin may still be here to take the front stage. At that point, we can finally use Bitcoin as Store of Value.

talking from a mere price point of view, gold was already surpassed, talking about store of value, bitcoin is born for that with is limited amount and deflationary system, add to this

comodity, you don't need so much space to story it like gold
no taxes needed to store it(but this may change in a far distant future if they tax your bitcoin directly, and not only when you dump for fiat), so moot point
easy trasportable compared to gold, and no fees again(or small ones)
much easy to hide than gold(here i'm talking only about physical gold)
harder to steal if you know what you are doing...
not seizable by any bank(this is related to the second point, it can change in the future, no one know...)

so there all the possibility for it to surpass gold as a store of value

Why would bitcoin surpass gold? :o

Give it time. Even if bitcoin is here to stay, Rome wasn't built in a day. But hey, I'm not one to believe that BTC is about to become world reserve currency, or some craziness like that, either.

people like to fantasize about bitcoin taking over fiat currency and gold. it's only not going to happen. what's wrong with bitcoin being an alternative instead of saying it will take over this and that.

Gold has some properties that bitcoin lacks. For one thing people can use it to show off by wearing bling gold jewelry. Those wearing it instantly make a statement that they have thousands of dollars without saying a word. There is a whole industry of jewelry shops and pawn shops making a living from that property of gold.

Showing off that you have thousands of dollars worth of bitcoins is not as easy. Bitcoin might become worth more than gold, but it's never going to take its place.

You are wrong. If you were on a desert island, and the only food there was a piece of bread. If the piece of bread was infinitely divisible, you don't think it is scarce?

Bit of a pointless comparison because the value (calories) of the bread is fixed.  The value of a division of a bitcoin is not and can be valued at any price people agree on.

I would say bitcoin [Or some other crypto currency] could quite easily take gold's place as the world's "preferred" means of "storing worth."  For one, it takes up very little space in comparison to gold.  Which means one could easily carry around billions of dollars in "net worth" without breaking a swet.  If you read the link I posted earlier, you will see how much better bitcoin [Or some other crypto] is much better than gold and can be worth far more than gold in the future.

https://cdn.panteracapital.com/wp-content/uploads/Bitcoin-vs-Gold.pdf (https://cdn.panteracapital.com/wp-content/uploads/Bitcoin-vs-Gold.pdf)

https://www.youtube.com/watch?v=yPIvqJsCOSo

Check this video out. I think it's a realistic approach. I don't see Bitcoin replacing national currencies, but I see it becoming Gold 2.0. The ultimate way to store value on the cloud.
As for time required to defeat Gold, I think it will take more than 5 years, but 10 years from now we'll see the first signs of serious amounts of wealth moving from Gold to BTC.

The same applies to gold, so I guess gold isn't scarce then.

+1

A scarce digital alternative asset class. Very possible and i don't mind this either. Question is, would its value escalate wildly if its use as an alternative became mainstream?

that's the point, it won't raise for nothing, if it would remain only a mere alternative, and maybe a niche alternative, well it depend how big you can see this alternative

going mainstream and being alternative are two things that can't live together

When I was debating the gold vs. bitcoin argument with a colleague, he used to say that gold was the best store of value. And I agreed with him. But I said that bitcoin would one day replace that because not only does it share similar properties to gold (it's technologically scarce), but it also has properties that make it far superior to gold. As many have said here, and as I said to him, I can walk into a store and pay with bitcoin if the shop accepts it. And my bitcoin will be easily broken up depending on if he is charging me $1.99 or $1.95. Doing that with gold is virtually impossible. He argued, "but there are gold coins." And I replied, "those gold coins are worth more than their face value."

The moral of the argument is this: gold isn't going away, but as bitcoin appreciates in value and becomes more stable, people will move to bitcoin. And what they'll like about it is the ease in which they can still transact while having a "safe" currency.

then again, what do people consider mainstream bitcoin usage? world wide accepted by merchants? being able to have a bitcoin balance in your bank account and thus spending it as easily as fiat currency?

What?

YOU are the bank...   Exchanges are the middle man between the banks and bitcoin.  If the banks stop doing business with exchanges, exchanges will begin banking.  I bet you coinbase would.

Does this mean the bank would hold your coin for you?  I sure as hell hope not.  I would hold it yourself.

well wouldnt the whole store of value be working, if not everyone were allowed to sell it whenever they want.

so it forces the value rise automatically. or limit the # of sales within that year or something.

Mainstream usage is when most people use it, like at least 5/10 transactions being done in BTC. It would need to reach a popularity level within the culture. When a mainstream comedian like Jimmy Kimmel drops a joke about Bitcoin and everyone gets it, then it will be mainstream.

You may be thinking of only "Western" culture.  What about other cultures of those with no access to banking?  They are slowly having infrastructure for cellular networks constructed in unbanked areas of the world.  It's only a matter of time before what we say 5/10 transactions is the norm; where 8/10 transactions will be the norm for those who are presently unbanked.  So, lets not forget them.

The one thing gold has going for it that bitcoin doesn't is thousands of years of human history as a valuable commodity.  I have a feeling it will always be one of the kings of the hill.

Bitcoin could easily surpass the value of gold in the near future (it almost did not long ago), but i doubt the powers that be will make it a global reserve currency.

Umm, we've been debating that since at least 2011.

This thread: https://bitcointalk.org/index.php?topic=35956
And continued here: https://bitcointalk.org/index.php?topic=68655

Over 1300 pages and counting. Consider those threads required background reading on the topic.


The answer is "yes, it's possible", btw.

there was an error in that quote, it was can't and not can, so you bitcoin can't be an alternative and reach mainstream at the same time

by the definition of it i think that the last thing you said is the most promonint to consider it mainstream, or fully adopted, and another to add is(the most important) not dependent of fiat, you can use it directly like you can use any fiat, but for everything in this life, so basically everyone should accept it as a payment like they are accepting fiat

well keep in mind, that global reserve currency is not gold.

Its in fiat form, which is in dollars, and it wouldnt be bitcoin if it were that aim.

I personally believe bitcoin will become preferred over gold as a means to "store wealth" in the next 10 years or less.  Bitcoin will first be used as a means of storing wealth before it will be used as a means of buying and selling goods and services in "modernized" culture.  The other billions of people who are not banked will begin to use bitcoin as a means of storing wealth AND commerce before "modernized" (banked) cultures adopt it as a currency.

When the blocks halve in July or August of 2016, we will see the price of bitcoin doubling over a month period of time.  The market will have much less downward pressure because only half the coin we have dumped on the exchanges today will be dumped each day when the blocks halve.  When the price goes up considerably, less bitcoin will be dumped by miners to pay for power [Reducing downward pressure].  Also, the number of transactions keep increasing significantly month after month.  The majority of those transactions are from trading bitcoin [Converting fiat into bitcoin and bitcoin back to fiat].

We will have many more people involved in trading bitcoin a year from now [When the blocks halve] than what we have trading on the exchanges today.  This will create an exponential increase in upward pressure when the blocks are halved as well.  So, once the blocks halve, we can expect a rather large rally going forward to buy [What is presumed to be] relatively cheap bitcoin.  I can see this realization coming to the minds of many just before the blocks halve and create somewhat of a race to buy bitcoin (raising the price).  We can expect a pretty big jump in price of bitcoin just before the blocks halve in my opinion.

If your argument against this is it did not happen the previous time the blocks halved.  I can honestly say there is a BIG difference going from 25 to 12.5 than it is from 50 to 25.  MUCH LESS DOWNWARD PRESSURE ON THE EXCHANGES WHILE HAVING A SUBSTANTIAL INCREASE IN NUMBER OF PEOPLE PARTICIPATING IN TRADING ON EXCHANGES AND THE FACT THAT WE HAVE MORE EXCHANGES.

Price predictions by month for bitcoin beginning March 31, 2016 for the race leading up to the blocks halving:

March 31/2016:          $  330.00
April 30/2016:            $  370.00
May 31/2016:             $  440.00
June 30/2016:            $  500.00
July 31/2016:             $  570.00
August 31/2016:         $  630.00
September 30/2016:   $  700.00

This next block halving will play a major roll in our next big rally.  However, we can expect more caution from investors this time compared to the previous rally to $1,200.00 in December of 2013.  This is why I don't have the price rising up to $1,200.00 or more over a 2 month period like the previous rally to $1200.

We will have more user friendly apps and technologies using the blockchain beginning to appear to the market by this time.  The headlines in the news will begin get more would be investors interested in joining the rally so they don't miss out.  This news of the rally and news of technologies using the blockchain will be all over the headlines and begin to give bitcoin the push it needs to slowly become more mainstream.  

This news will create the biggest rally yet [In my opinion] for bitcoin.  It's a rally that will last for many years to come.  Why?  because all of the downward pressure will be erased overnight when the blocks halve and the number of traders in the bitcoin exchanges will have more than doubled.

Over the next 3 years [After the blocks halve] we will have more user friendly apps and blockchain technologies will begin to be used in the financial sector.  The headlines in the news about bitcoin and the blockchain will be more prevalent [Encouraging more investors and traders to come into the fold].  We could see the price of bitcoin rise exponentially by the next block halving in 2020.  Why?  Even less downward pressure from bitcoin being dumped on the market.  New available bitcoin will not be as available anymore because it's worth much more and less of it is being dumped on the market by the miners.

My predictions on the price of bitcoin by year after the blocks halve:

August 2016:         $      630.00
August 2017:         $   1,200.00
August 2018:         $   1,800.00
August 2019:         $   2,800.00
August 2020:         $   4,000.00
August 2021:         $   5,800.00
August 2022:         $   7,500.00
August 2023:         $ 12,000.00
August 2024:         $ 15,500.00
August 2025:         $ 19,000.00

All of these price marks for each year were keeping other things in mind.  Such as world economy; scarcity of bitcoin [Only so many made; still tens of thousands of metric tons of gold yet to be mined]; popularity of the blockchain growing year after year; popularity of bitcoin growing year after year; the ease of use of apps designed for the blockchain year after year; more retailers accepting bitcoin year after year; more people in "unbanked" parts of the world using bitcoin in growing numbers year after year.

my definition of Mainstream (MSM) is when for example, all the major financial networks cover its price movements daily, like they do for other assets. Or, when it is listed at your stock brokers as an asset anyone can buy into OR when (in my country), its price vs the local currency is covered during the business segment like USD, GBP,EUR or when CME traders can view it on their globex platform as as a tradable asset.

In short, i mean legitimacy in the eyes of the public. SO that no one can say it is a 'scam' anymore or think that its going away.

Comparing a heavy, inert, and malleable metal, used as money for 6000 years, to a string of characters isn't really helpful at this point. Gold is supposed to be a fallback, a bearer asset with value regardless of externalities.

Bitcoin is a highly speculative digital token that could be the moon or zero, sometimes within the same week. It's dependent on a bunch of things working perfectly just to function, let alone thrive. They're completely different markets, and people (should) have completely different reasons for holding them.

For perspective, being generous, the entire market cap of btc is a few weeks of phone sales for aapl.

How many people here know folks who have a position in gold?

Of all the people I know, it is precisely one and I have never known anyone else who's dabbled with it in the past.

I'd say Bitcoin could have far more potential and penetration than gold if it served a similar role.

You don't have to dick around with paper gold, buying an alleged share of a bar in a vault in a far off land or taking possession of a physical lump that may be fake and can only be offloaded in a handful of places.

All you gotta do with Bitcoin is buy the shit and it's forever yours within a few minutes. No question marks, no third party flakiness.

That's worth something in my book.  

Well said, Sir!

I have a fair bit of gold stacked, actually I converted all my BTC in to the yellow shiny stuff.

All of it huh? You don't even want to hedge a bit with BTC? Seems pretty risky.

My sentiments exactly!!!

I'm sitting at 40% BTC; 35% GOLD; 10% SILVER; 15% STOCKS

When I swapped out my BTC for gold it wasn't that far off a 1:1 ratio, now its over 5 BTC to an oz of gold, more than happy with my decision.

You get to stare and digits on a screen, I get to play pirate with my treasure chest -

https://i.imgur.com/buggJgd.jpg

https://i.imgur.com/CWIdsyp.jpg

https://i.imgur.com/rEzoWLd.jpg

LOL, you actually keep it in a treasure chest! :P

Diversification is best. Good to have positions in bitcoin, gold, silver .... revenue-earning assets like real estates .... I'd say solid dividend stocks but I do believe that the equities markets are in for a serious downturn in the next year.

Cool looking treasure chest, but it shows how ancient the concept of Gold is. Storing things in huge, unmovable chests vs instantaneous transactions all over the world and weightless storing ;)
Not hating on gold, always good to have some, just hope people aren't crazy enough to dump all of their BTC due the manipulated low price.

Gold will last through the ages in some capacity. I myself couldn't give a shit about my distant descendants digging up my gold and buying themselves a spacepod. I'm more tuned in to the next 20-40 years.

It is a pointless comparison because the bread is something of value for direct use, while money is not directly useful. Therefore the amount of money is unimportant; there is always just enough.