[2017-08-29] This Major Gold Investor is Entering the Bitcoin Market

[moriskarlov]

One of the biggest asset managers in the United States and major investor in the gold market, VanEck, is now entering the Bitcoin.

From Gold To Bitcoin

VanEck is one of the biggest investment and asset management firms in the United States. The investment giant is currently managing an estimated amount of $38 billion in assets. The firm which was founded in 1955, has offices in the United States, Germany, and Australia, which in recent years has focused on precious metals like gold, silver, and platinum.

The company is currently offering more than 50 different exchange-traded funds(ETF) for pension funds, banks, and endowments. Currently, VanEck’s main investment tool is gold but now it appears that it’s going to “dive” into the Bitcoin market.

The market capitalization of Gold is about $7 Trillion, compared to the market cap of Bitcoin which is a little over $71 billion, Bitcoin appears relatively small. But VanEck believes that there still a lot of potential in the Bitcoin market.

In a recent article,  Morgan Stanley believes that Bitcoin might still be too immature to serve as an inflation hedge and that gold is a better investment. In the article Morgan Stanley analyst, Tom Price, stated following about bitcoin:

    "Some claim that the protocol limiting bitcoin’s supply growth rate, underpins its value,"

he also added:

    "But if Bitcoin is successful long term, we should continue to see competitor cryptocurrencies and market strategies emerge to exploit the new economic rent — a Bearish risk for Bitcoin’s price."

>>> http://bitcoinist.com/this-major-gold-investor-is-entering-the-bitcoin-market/

[1Referee]

I have always believed that there would be a moment actions like these would become reality. I am even of believe that at some point, large Gold holders will start to liquidate a certain part of their holdings, where they after that invest that money into Bitcoin directly, or through certain financial instruments. Gold isn't exactly doing what it for a long time was praised for, and Bitcoin on the other hand, is doing exactly that. Bitcoin is in nearly every aspect superior to Gold, and that's definitely something people will be appreciating if they at some point decide to hop over entirely, or partially. The only aspect where Gold has the main advantage over Bitcoin, is that it is a currency tool in physical form that can be used in basically any offline situation.

[Xavofat]

"But if Bitcoin is successful long term, we should continue to see competitor cryptocurrencies and market strategies emerge to exploit the new economic rent — a Bearish risk for Bitcoin’s price."

He has a point there. 

As someone managing assets and hedging against inflation, your first thought would be precious metals in the current market, simply because they have been used as a store of value for a long time.  While BTC is also scarce, cryptocurrencies themselves are not scarce and they can also develop, while precious metals can't.  The difference is that there are a limited number of different precious metals, whereas there is no limit in the number of cryptocurrencies.

That's why BTC adoption as a currency or as a global store of value is essential before it can reliably retain its value.  Either many governments worldwide need to use it to back fiat currency (unlikely) or it needs to be used as a currency enough for other cryptocurrencies' developments not to matter very much (apart from those with different use cases).

[fisheater]

This guy is right. If you like the gold, you would like the bitcoin. After all these two are very similar in nature.

[Kprawn]

This guy is right. If you like the gold, you would like the bitcoin. After all these two are very similar in nature.

Agreed, but the major difference is.... Bitcoin has a supply cap of 21 000 000 bitcoins and gold deposits are unknown. They

can find massive gold deposits tomorrow and that will influence it's scarcity. The Goldbugs might transition to Bitcoin, if they

can just understand the technology and also the similar qualities of both commodities. 

[error08]

They just want to diversify their investment because bitcoin surprisingly could increases over %400 in this year and gold seems increase a bit.
Doesn't mean bitcoin is better than gold and vice versa, because most people do not see it as a reliable currency instead of a bubble investment, to store the value. I'd like to buy gold as well, if its price decline after massive funds from gold holders flow into bitcoin environment.

[RodeoX]

Welcome to the party! We have drank over half the booze already.