Bitcoin Forum

Gold has been the store of value par excellence for about 48 years now. After the United States returned to granting the private use of gold in 74 and the decoupling from the dollar, they allowed a dizzying rise in its price.

However, what makes gold a store of value are several factors, including:

Scarcity -> Gold is one of the scarcest metals on the face of the earth, it is not the scarcest. But it remains among the poorest, which makes it palatable.

Proof of work-> Gold is difficult to mine, as you have to organize human resources + machinery to mine it. Once extracted, it is necessary to provide for the logistics and control of the gold.

Let us also remember that gold is a metal that resists time, that is, it does not undergo variations.

For several days I have been thinking of Bitcoin as the new gold for the 21st century:


Bitcoin is inefficient as layer 1 if we look at it as a payment system. For this, we are working on solutions like Lightning Network (layer 2) - but that's not the main point.

Mining Bitcoin is already difficult today, it will become increasingly difficult over time -> This is an important analogy with Gold. Both are difficult and will be increasingly difficult to extract.

Bitcoin has a limited amount and will not change over time -> Same as gold.

The Byzantine Generals Problem -> Miners are incentivized not to compromise the BTC network as well as is very complicated, we can compare it with the physical gold surveillance system.


The first country that will take mining seriously by meeting the various mining farms, and finding efficient mining solutions, could increase its economic capacity.

What if the US regulates crypto and declares Bitcoin a store of value? Basically, it doesn't have an ICO, there are no teams behind it, and there isn't an owner.

Basically Bitcoin already is the gold of the 21th century. Yes it is not accepted by many governments, but still it widely adopted. I don't think even that it is necessary that governments use it, since many (most) governments also don't accept gold payments and also don't own large amounts of it.

I think it is kind of wrong to put a sign of equality between Bitcoin and Gold simply because we are talking about two completely different things.  Sure, there are a TON of reasons we can use to say the two are similar, but on the other hand they are not at all besides them both being a very good store of value and, ultimately, Bitcoin even surpassing Gold's returns over the decade.

-
Regards,
PrivacyG

True, when it comes to industrial mining, it is a very expensive and dirty business, whether it is surface mining or mines, it requires a lot of money, manpower and time. However, ordinary people search for gold only with metal detectors or by washing on river/sea shores.


Bitcoin is incomparably more efficient than gold in the payment system, and it works quite well even without LN - the problem is with users who don't want to think but want everything to be automatic - but if you know how to properly set the fee in relation to mempool, the transaction will be confirmed in a reasonable time. In addition, any transaction that does not have an RBF can be accepted without confirmation, especially if it is for smaller amounts.


Partly true, because Bitcoin has a max supply and we know that by the end of this decade 99% will be mined, while there are undefined amounts of gold on our planet, not to mention outside of it.


So didn't El Salvador do just that - Bitcoin is legal tender and they mine it with the help of geothermal energy? What if the US declares Bitcoin illegal, closes all crypto exchanges and demands the same measures from its allies? Don't believe that the US could ever go so far and give such legitimacy to Bitcoin when they don't allow a regular spot ETF that is available in many other countries around the world.

Why do they necessarily need to "declare" it as a store of value? If bitcoin performs well for the market to think that it's a good store of value, then it doesn't matter what the government thinks in the end as the market will act upon whatever their perceptions are anyway.

To be honest, there are too many differences between gold and Bitcoins.
So comparing both of them is really baseless.
Yes the only criteria in which Bitcoins and Gold can be compared are due to their price.
Apart from the price both has sky-land gap if we see thoroughly.
I can claim that Bitcoins are really valuable to their investors in this modern era. But at least give Bitcoins it’s own name in the market. Don’t call it as “Modern-day Gold”.

Proof of work, not necessarily. There are cheaper ways to mine gold, which are more environmentally destructive and humanly objectable, usually done in countries with war to mask these efforts.

Proof of effort for sure but sometimes at the expense of others and purely high profit margins. I guess though arguers would say the same as Bitcoin miners stealing electricity?

Bitcoin has a limited amount in the sense that it has a maximum supply. Which means that there can never be a 21,000,001^th Bitcoin. This isn't the same with gold. Gold is limited but in a totally different sense. Gold has been mined for millennia and yet it is still mined until today and its supply has been continuously increasing no end.


This may not be comparable. Satoshi found a way for data to be tamper-proof. This isn't the case with gold. Gold's surveillance system may be tight and strict, but fake gold is everywhere. Even China itself has fake gold reserves.

I don't quite agree with this, Bitcoin has limited supply true, but can never be the same as Gold considering that we cannot accurately estimate the amount/quantity of undiscovered gold in the planet. You know just recently a huge deposit of gold was discovered in Uganda, source  (https://energycapitalpower.com/uganda-discovers-31m-tons-of-gold-ore/#:~:text=Recent%20exploration%20surveys%20in%20Uganda,currently%20standing%20at%20%2412.8%20trillion.)

This recent deposit discovered alone is more than the total fixed amount of bitcoin that can be mined. This discovery of this large amount of gold makes one wonder and accept the possibility that there can also be another deposit of gold as large as that sitting somewhere undiscovered.

BTC is far from being widely addopted and to reach the level gold is now or was in the past. And the biggest issue BTC has is not being tangeble, and that's what gold has. Also, gold is not only used as a store of value...actually, no need to even comapre the two.

I am so sorry if I made you disappointed. I am a Bitcoin believer but I would like to say fiat currencies, CBDCs, precious metals including gold, Bitcoin and altcoins will co-exist on Earth and will be co-used in human societies.

• The bullish case for Bitcoin (https://medium.com/@vijayb_24615/the-bullish-case-for-bitcoin-6ecc8bdecc1)
• It is a good book for you (and everyone) to read in order to become a true Bitcoin believer. In the book, you will see comparison between gold and Bitcoin but you're free to absorb it in your own perspective.

Why does Bitcoin need to be something just because of its value. Bitcoin is very different to Gold in terms of usability and valuation. Why not we should categorized Bitcoin as is because this is under a new category in terms of Bitcoin and I want it to be known as Bitcoin not as replacement of Gold or something valuable.

Some argue that, BTC is Gold 3.0. A digital version much better than gold, because it does not weigh and is very easy to transfer to the other side of the globe in large quantities in minutes and at low cost. In the end, I think that more than definitions, what determines the essence of something is the majority use it is given, and today it seems that it is more an improved gold than a P2P Electronic Cash System, although the two characteristics coexist in BTC.

Hi, OP;
So much talk, speech weren't necessary, btw Topic that has been discussed several times in the forum, the issue that bitcoin is the new orange...  :)

men! typical issue of shooting arrows, so before thinking about what would happen, we must analyze if such a thing is possible, that is, it is not so feasible that such a thing happens in the short term, although certain lights are already seen in some politicians enacting laws in some areas such as mining, but in the way you propose it, why spend "ideas" when the feasibility in the short term is unlikely.

Bitcoin could become the gold of the 21st century?

I believe thats highly possible and if we based on bitcoin's achievements in recent years bitcoin was transformed from a simple unknown digital coin in 2010 into one of the most successful digital assets in 2022, thats why bitcoin was often called the digital gold of today. I think it matters because whether we like it or not bitcoin has already proven as a valuable invention of the 21st century and for me thats a fact.  

Gold's scarcity is largely assumed than a proven fact, which is why sometimes is can lead to unpleasant surprises, at least locally if not globally. For example, there used to be inflation which occurred in Western Europe in 16-17th centuries (https://en.wikipedia.org/wiki/Price_revolution), which is attributed largely to large influx of gold from Spanish colonization missions. As for our times, there've been reports on Uganda's huge gold deposits (https://www.reuters.com/article/uganda-gold-idUSKBN2NP17M) that, if confirmed, would more than double current amounts of refined gold.
Also, proof of work is technically true, but it's necessarily harmful to the environment and local communities, whereas Bitcoin mining's ecological impact depends on the sources of energy.
That being said, Bitcoin is way less stable than gold, and I think gold is often associated with certain safety and stability that Bitcoin does not possess.

It's quite possible and perhaps likely but even if it doesn't in the 21st century, then for sure in the 22nd century.  It took gold time to establish itself and in this aspect bitcoin will be no different, even though the timeframes for establishment will be different.

Isn't it already gold or fair to say more valuable than gold?
Being in the crypto space Bitcoin is more valuable for me than gold. I even sold gold to buy bitcoin at once.

When bitcoin will have mass adoption and will be used as an established form of payment system worldwide then we will have the stability. It will still take a long time but some day we hope we will have it. We are still in diaper. Let us learn to walk, then eat food, learn wearing cloths and grow up.

I agree that there is a good case to be made about the correlation because both go up when dollar gets devalued and gets lower when dollar gets stronger. But aside from that, the similarities usually ends. You could draw a lot of connection if you so wished to desire but in that sense it could be drawn a lot more.

Plus, gold could still be "found", rare these days I agree, but there is no limit to how much gold there is, because it is unknown give or take, sure we won't be finding an earth size gold for sure, but it is still unknown how much is left. On top of that, with space getting closer and closer each decade, I am sure in the distant future "space mining" won't be impossible.

So, even if we see the short term similar, eventually gold will get devalued by influx of more gold coming in, whereas bitcoin will always be 21 million capped no matter what happens, plus all the burned ones, so it's even less.

So Bitcoin with its limited supply can be our gold for this century?

gold is used for chips in computers. bitcoin need computers for it to exist since bitcoin will forever stay in a digital form. So I believe it is highly unlikely that bitcoin will replace gold.,

but this time of bitcoin many people in government is making use of Bitcoin for investment but they fall to come open and make it known that Bitcoin is good to invest with, but the government everybody is talking about Bitcoin is ready to adopt bitcoin but pride is what is holding them. Why many of them in government have cryptocurrency in their wallet

Both shouldn't comparable because they have pros and cons to each other and Bitcoin shouldn't become like gold in the future.
There are a lot of people who keep comparing them which we know they have different characteristics and both are opposite.

I didn't know if the government would not use gold as cash but for sure they have this as an asset.
Those who are afraid to the volatility price they may choose gold and those who are willing to risk the volatility price and have a financial freedom against governemnt will pick Bitcoin.

I think digital gold is more appropriate, not physical gold which has form and value, besides gold and btc have very different characteristics.

I don't think it will happen soon, at least. No matter how it sounds, but it takes a lot of time, and in general it is unlikely to happen, because for many gold is still more valuable, because it exists physically.

Bitcoin can be used as a currency on 2010 when Laszlo bought 2 pizza with 10,000 Bitcoin.
Bitcoin has been accepted in many online marketplaces.
Bitcoin already have many investors from institutional and government.
Bitcoin has been accepted as a legal tender in 2 countries e.g. El Salvador and Central African Republic.
Bitcoin already prove it can survive for 13 years so far, unlike shitcoins who died after 1-2 years.

With those achievement of Bitcoin itself, how you can say it wouldn't happen soon and unlikely to happen? I guess you're come from where Bitcoin were banned in your country, that's why you didn't see so many update, development and adoption of Bitcoin.

Talking about how valuable an asset because it just have a physical appearance, you're didn't understand about Bitcoin at all.

Bitcoin has a limited total supply of 21 million BTC but gold I don't think so. So far the total amount of gold that has been mined is 201,296 tons, an estimated more than 53,000 tons have not been mined but have been identified. And I believe that somewhere on earth there are still many places with gold that people have not yet found, they will continue to hunt until the definite source is exhausted. It can be said that gold does not have a specific total supply.
https://i.imgur.com/9BYA3WV.jpg
pic source: Kalo Gold

Bitcoin will surely become the new reserve for currency and finance institutions and they will create alternate coins, whose value be based on the reserve value of bitcoins used for hedging. In this way the whales will make money for each transaction done against their own currencies.
So in that way bitcoin will become what gold is today. The reserve currency.

Bitcoin being limited in number will one day become a scarce asset which means the value of bitcoin will manifold itself. Many people have already started referring to bitcoin as digital gold.

That is Wonderful.. I am a firm believer in crypto space and BTC but I am also a believer that Gold still shall have its own value especially during the time of war and uncertainty.

Some people prefer to buy BTC than gold, regardless of whether the price of bitcoin falls, the reason is because when bitcoin rises in price it can leave millions of profits if a good investment was made, the only problem is knowing when gold will rise it is a safe haven for the value of money, it is not bad, but bitcoin is more volatile, as well as it goes down, when it goes up it can go big.

In my opinion bitcoin, even in the future, will exceed gold from its price value, because the supply of bitcoin is limited. only 21 million. if the amount of gold can be categorized, there is no limit, as long as many people are mining gold, let alone new
recently heard the news, that uganda found 31 million tons of gold.

There's no need for Bitcoin to replace gold. Both can coexist without a problem.
Scarcity isn't enough for an asset to become the best store of value. A bunch of random "developers" could easily create a centralized "scarce" altcoin with a fixe maximum supply in circulation. The problem is who is going to trust such centralized "scarce" altcoin.
Bitcoin had built enough trust in the last 12 years and it had proven to be the most secure cryptocurrency(assuming that you don't rely on centralized BTC wallets and crypto trading platforms). I can't be bothered with the question about BTC global dominance or Bitcoin becoming the "gold of the 21st century". I don't think that Bitcoin will ever going to reach complete global dominance, but that's OK.

It would be awesome if the US decides to do that, but I don't think it's very realistic right now. The volatility in the bitcoin market is still too high for it to be a good store of value for everybody. Historically the Gold price has kept it's value for a long period of time, we haven't seen a price drop of 50% in a few months before with it. That is why it's so attractive for the older generation as an investment to store value. With the high volatility in bitcoins I would also not recommend my grandmother to invest in it. She is above 90 and at her age I advice against investing in stocks or cryptos, she still holds a bit of gold but the most she invest in is short term bonds. For the younger generation this completely different, the longer the investing horizon I would recommend to invest in cryptos rather than gold. The thing with gold is that it's good to store value, but you have no more upside potential. There is no chance that gold will rise 50% in the next 6 months, whereas with crypto currencies you can store your value long term as well and still have a chance to make a nice profit.

The USA will not do that for sure. They are the most liberal nation in the world so they should technically speaking be the one to do it, but they care about their USD a lot. And right now they are doing fine, even though domination of USD goes down, the value of it goes up, which means that there will be a reversal soon and people will start using that all over again.

I just do not see how it is even possible, think about how big the USA market is, and if it happened that would be awesome. But right now, even Coinbase is down like 80% in the stock market, it's just not a nation that is seeing crypto as the get out of jail free card situation, they won't do it.

If you use gold as a metaphor, it's cool, because we are all going through this bitcoin era, and we feel that too. And every Bitcoin lover believes its future is far beyond now. Gold has created its own place in history and now I hope Bitcoin is the creator of the future.

Cryptocurrencies are in a booming position beyond imagination. Bitcoin is a currency that is valid in all countries of the world, the price of this currency will double its price in a few days at its current position. That's why I want to say that Crypto currency Considered as a reserve currency. Because everyone will reserve this currency increasing its price. After a few days this bitcoin is located with twice the price of hearing I think.