Friday, November 29, 2013

Why One Bitcoin Will Be Worth More than One Troy Ounce of Gold

Coming from someone who is invested in both the answer is simple: you can easily hold and spend Bitcoins, or BTC. As a currency, BTC is infinitely better than gold.

Gold is a relic of a prehistoric monetary system. It is not suited for the modern digital economy. Paper money was a solution to the inherent inconvenience of gold. Bank-backed gold certificates of the deposits were used as money simply because of convenience. Unfortunately, banks started to issue more of these certificates than they actually had on hand. Moreover, the issuance of paper money enabled the rise of a powerful and elite class of bankers that to this day that remains outside of public scrutiny. Bitcoins were invented to circumvent the dilution of currencies via governments and fractional-reserve banking.

Bitcoins are more suited to the modern global economy. Like gold, there is a limited supply of them. But unlike gold, they are easily transmitted from payer to payee via the internet. For this very reason, Bitcoins are a more legitimate investment than gold is. However, in the event of societal collapse gold will be the only asset that will still "work." I don't see such a collapse happening anytime soon so I recommend investing more of your hard-earned cash in BTC than gold.

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