Can Bitcoin Ever Match or Replace Gold as the Ultimate Reserve Asset?

[Joeboy]

I hail una o my people..... We all sabi say for many years now, na gold we dey all see as the ultimate reserve asset due to its level of stability.... But recently, I con dey reason whether Bitcoin fit stand for the same ground like gold? As I con dey reason am dey go......I con stumble upon wetin IMF talk for their Balance of Payments Manual (BPM). According to dem, dey say for any asset to qualify as “an ultimate reserve asset”, e must meet this criterias:

• E must be claim on non-resident or high-purity gold bullion: This one means say reserve asset suppose be something wey one country fit hold as claim against another country or global system.....As we know Gold dey qualified for her coz anybody dey recognize am, no matter the country wey you dey......... Bitcoin sef dey globally recognized, e no dey belong to any single country, so we fit talk say Bitcoin meet this criteria
• Central bank or monetary authority gats dey in direct control of am: Na here the wahala con dey coz forr IMF eye, reserve asset suppose dey directly under central bank control, but we all know say Bitcoin dey decentralized meaning say the control dey with individual wey hold private keys. Bitcoin no meet this criteria.
• E must be liquid and readily available when dem wan use am for foreign exchange market or balance of payment issue: We all sabi say Bitcoin dey liquid for market, but price dey still dey dey volatile, If na emergency, FG fit sell am quick, but I no sure say value go dey immediately coz as we all know say the value of Bitcoin mostly come in the long-term...So Bitcoin partially fits into this category
• Lastly, must be high quality, mostly investment grade security: Bitcoin kind of fit into this category coz people trust am and dey investment into am

Here is a link to the criterias
Frequently asked Questions on the Characteristics of Reserve

Bitcoin still dey climb the ladder, but I believe say e get the potential to match gold someday, coz as we all know day by day the distrust in fiat dey increase, e no go too surprise me if one day central banks begin dey use small allocation of Bitcoin alongside gold....... So what do you think about this guys .

[Lida93]

Op you for like add link to this your beautiful post abeg. E get why.

As for all those conditions way you enlist say IMF na give am as criteria for an asset to meet for am to be recognised to use am as national reserve, all that na propaganda way IMF the use discourage countries from adopting bitcoin adding it to her reserves because many of this countries hold the USD and gold as their major reserves and if they come the add bitcoin now that one fit affect the USD way be one of the popular currency way some countries dey use for reserve. And the implications be say  the US economic power for the world go start to drop because bitcoin dey decentralised and no country not even US fit control am as them go fit control their USD and gold too.
Who you think say the fund the IMF?

[Churchillvv]

Basically, bitcoin not suppose be that kind of assets wey IMF Dey explain as e suppose be currency for normal usage and not basically an asset to hold like gold wey no really be day to day currency but occasional however bitcoin is now push to such stereotype that it’s more of an asset than a currency.

however bitcoin is not even pushing to replace Gold nor in competition with any assets, trying to make bitcoin a reserve is a strategy to put bitcoin under a central control but reason why we see it likely or eco friendly is because it’s going to give it a high stand for price stability and increase in the coming days but some are not really interested for bitcoin to be some asset that governments will get hold of through reserve.

So it’s bitcoin users that are pushing towards that but bitcoin wasn’t created to be such asset or to replace any other currency, it’s the currency for the 1% people who are not interested in centralization and those who desire privacy.

[Sticky Bomb]

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Who you think say the fund the IMF?

IMF gets it's funding from 3 categories which are member quota, multilateral and bilateral loan agreements. With the major funding coming from members quota which means every member country contribute to it and these contributions are seen as your reserves.

Currently IMF partner countries are 191 in total in which our dear Nigeria is one of them
https://www.imf.org/en/Countries

I could see countries that are attached to BRICS here, so I don't really think it's about the dollar, even Russia is a partner country. I think it's just their policies and those policies are just against Bitcoin to some extent.

[Lida93]

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Who you think say the fund the IMF?

IMF gets it's funding from 3 categories which are member quota, multilateral and bilateral loan agreements. With the major funding coming from members quota which means every member country contribute to it and these contributions are seen as your reserves.

Currently IMF partner countries are 191 in total in which our dear Nigeria is one of them
https://www.imf.org/en/Countries

I could see countries that are attached to BRICS here, so I don't really think it's about the dollar, even Russia is a partner country. I think it's just their policies and those policies are just against Bitcoin to some extent.

https://www.google.com/url?sa=t&source=web&rct=j&opi=89978449&url=https://en.wikipedia.org/wiki/International_Monetary_Fund&ved=2ahUKEwjI6qzJ5bSPAxVrhv0HHe7VHfEQFnoECAQQBQ&usg=AOvVaw3oWK-lN8J7poDddk7Jfv9a
https://www.imf.org/en/About/Factsheets/Where-the-IMF-Gets-Its-Money#:~:text=Member%20quotas%20are%20the%20primary,position%20in%20the%20world%20economy.

I understand nah through quota pooling funding system from different countries nah the IMF the use run their finances as it is in paper. I no argue. But you done know say nah who get highest quota nah be the US and nah them get control over than any other member country. The Nigeria way dey there with many other countries way make up that 191 members nah just "OhYes" member in the actual politics of things in the IMF.

Your influence dey determined by your quota contribution and nah the board of governors for the IMF nah be the main Koko for there. Oyah check which countries dey for that board of governors if your African countries follow there. Na only for the debt side of it you go see those countries in their numbers. Make we no deceive ourselves nah.

[Joeboy]

Op you for like add link to this your beautiful post abeg. E get why.

As for all those conditions way you enlist say IMF na give am as criteria for an asset to meet for am to be recognised to use am as national reserve, all that na propaganda way IMF the use discourage countries from adopting bitcoin adding it to her reserves because many of this countries hold the USD and gold as their major reserves and if they come the add bitcoin now that one fit affect the USD way be one of the popular currency way some countries dey use for reserve. And the implications be say  the US economic power for the world go start to drop because bitcoin dey decentralised and no country not even US fit control am as them go fit control their USD and gold too.
Who you think say the fund the IMF?

I don edit the post add the link to the IMF manual wey talk about those criteria, the thing be say the link go carry ona go download the PDF straight from IMF site......In all, the sweet thing about the decentralized nature of Bitcoin be say, unlike USD or even gold wey dem fit cage inside vaults with numerous policies, nobody fit control Bitcoin. And if adoption continues to rise probably due to people's continuous loss of faith in fiat, honestly e go reach one stage where no IMF criteria fit even stop central banks frm considering am.

[Princess Leah]

Basically, bitcoin not suppose be that kind of assets wey IMF Dey explain as e suppose be currency for normal usage and not basically an asset to hold like gold wey no really be day to day currency but occasional however bitcoin is now push to such stereotype that it’s more of an asset than a currency.

however bitcoin is not even pushing to replace Gold nor in competition with any assets, trying to make bitcoin a reserve is a strategy to put bitcoin under a central control but reason why we see it likely or eco friendly is because it’s going to give it a high stand for price stability and increase in the coming days but some are not really interested for bitcoin to be some asset that governments will get hold of through reserve.

That's true, Satoshi didn't create Bitcoin as a store of value or for it to be competing with Gold as an asset class and used as a reserve, however the growth of Bitcoin has made it to fall under that category and used as a store of value than an alternative to the FIAT currency and currently most Bitcoin lovers are now following that path since they now see great potential in Bitcoin when it's held for long-term than when used as a means of transaction.

 Over the years, we've seem Bitcoin move upwards in the asset class, it's now even refer by many as a "digital gold" which means that they believe it has lots of potential to match the use case of gold in the future.

[DPHOR]

I no know why we dey always compare Bitcoin with gold, in fact Bitcoin na gold of its own and we can also invest in gold or Bitcoin, the is that Gold is not fast rising assets like Bitcoin, so I fit say gold dey less volatile than Bitcoin because e no dey too lose like that. The reason why Bitcoin dey increase on regular basis is because na higher volatile asset wey be say if you put money you fit lose, like the price fit drop to zero and again, e fit just rise instantly. Just imagine if na bitcon way don dey for centuries now wetin you for talk about? Just that Gold na longer something wey don dey even before our existence on this earth and has been there and it hasn't failed neither dump on people.

[TokenTikas]

I no know why we dey always compare Bitcoin with gold, in fact Bitcoin na gold of its own and we can also invest in gold or Bitcoin, the is that Gold is not fast rising assets like Bitcoin, so I fit say gold dey less volatile than Bitcoin because e no dey too lose like that. The reason why Bitcoin dey increase on regular basis is because na higher volatile asset wey be say if you put money you fit lose, like the price fit drop to zero and again, e fit just rise instantly. Just imagine if na bitcon way don dey for centuries now wetin you for talk about? Just that Gold na longer something wey don dey even before our existence on this earth and has been there and it hasn't failed neither dump on people.

Yes, I also don't understand why people think about gold and bitcoin this way. We generally know that gold is a symbol of stability, and bitcoin is a symbol of future potential. Gold has been around for thousands of years, has low risk, and has stable reserves. On the other hand, Bitcoin is digital gold, with a limited supply and volatility, but it has high growth potential.

So instead of replacing each other, it would be best to balance the two, and we know that gold is for safety and bitcoin is for future potential. Even though we understand these things, we still make different comments. I think it is not right to make such comments without understanding.

[DPHOR]

I no know why we dey always compare Bitcoin with gold, in fact Bitcoin na gold of its own and we can also invest in gold or Bitcoin, the is that Gold is not fast rising assets like Bitcoin, so I fit say gold dey less volatile than Bitcoin because e no dey too lose like that. The reason why Bitcoin dey increase on regular basis is because na higher volatile asset wey be say if you put money you fit lose, like the price fit drop to zero and again, e fit just rise instantly. Just imagine if na bitcon way don dey for centuries now wetin you for talk about? Just that Gold na longer something wey don dey even before our existence on this earth and has been there and it hasn't failed neither dump on people.

Yes, I also don't understand why people think about gold and bitcoin this way. We generally know that gold is a symbol of stability, and bitcoin is a symbol of future potential. Gold has been around for thousands of years, has low risk, and has stable reserves. On the other hand, Bitcoin is digital gold, with a limited supply and volatility, but it has high growth potential.

So instead of replacing each other, it would be best to balance the two, and we know that gold is for safety and bitcoin is for future potential. Even though we understand these things, we still make different comments. I think it is not right to make such comments without understanding.

Of course that is true my dear, so whenever such discussion comes up its make me feels as if they don't what they are saying or just trying to rate Gold very low or even condemn it whereas giving bitcoin much hype and attention, although I don't take anyone to be more worthy but it all depends on the likely of individual on what they feels like investing their heart earned money rather than putting into bitcoin that is so volatile, majority of the world population are investing on Gold, is just of recently people are trying to diversify their investment to other digital assets such as, bitcoin and other cryptocurrency out there.