Why gold is still king
In the media these days we are hearing a lot about bitcoin and other forms of “cryptocurrencies”. One day Bitcoin is trading above $15,000 US and the next it is trading below $8,000 US. Many people think there is money to be made with Bitcoin; they believe it can be used in the same manner as Gold, but I will discuss next, here is why gold is still king.
With distrust or a lack of confidence that stocks will still rise, stocks are sold and cryptocurrencies are purchased. Many believe if the stock market crashes, cryptocurrencies will rise. This alternative form of investment is growing more common. Some people are shying away from gold as the alternative investment but here is why gold is still king, but first we will explore how gold and cryptocurrencies are alike.
How gold and cryptocurrencies are alike
- Gold, like cryptocurrencies does not yield any income. No interest or dividend income is earned regardless of how long you have owned them.
- Both can be used as actual currencies in that goods or services can be bought or sold with gold or cryptocurrencies providing the parties involved can agree to what their value is.
- Speculation is inherent in both alternative forms because they are used as fear fighters; when people are fearful the markets will drop, money is diverted to gold or cryptocurrencies.
From this comparison it is evident that gold and cryptocurrencies are similar in many ways regardless, now let’s discuss why gold is still king.
Why gold is still king
- Gold is tangible, you can feel it, smell it, taste it, see it and hear it if it hits the floor. If the markets crash putting us in a depression would you want a tangible shiny object (humans throughout history have proven we value the shiniest of objects) or something you cannot see?
- Gold has been around for centuries and is much more stable than other forms of alternative fear investments. Check out the historical price history chart of gold here while you can see the historical price history chart of Bitcoin here.
- Gold is more actively traded throughout the world and is far less susceptible to fraud. When was the last time you heard of a major gold heist whereas a large Bitcoin heist was in the media only two months ago, check out the story here. Gold is dense and very heavy and unlikely to be stolen in large amounts. Someone cannot just hack into a bank and steal physical gold!
Next time you hear the rave reviews and subsequent busts of Bitcoins and other cryptocurrencies, ignore it. Ignore the hype, focus on your life, not all the unwanted and confusing noise. The media portrays a Bitcoin as an actual coin because we do not know what else to think of it as and that is scary. If we cannot see something for what it is how does it really exist?