Ever since Bitcoin made the transition from being a peer-to-peer electronic cash system to more of an investable, digital gold, it has drawn comparisons with the precious metal as a commodity that accrues value.
Bitcoin had its heyday, when it was rallying like nothing ever seen, and those who invested early were making a killing that not even gold could compare with. However, that does not necessarily mean that Bitcoin, or cryptocurrencies in general, should be seen purely as an investment.
Cryptocurrencies have many different facets to them, and are able to be applicable in a host of different sectors in society, from technology, finance, politics, economics and trade. The underlying Blockchain is the true star, and that needs to become more obvious.
When it comes to investing in something, Gold, or any other asset which is far better suited to it should be the answer, not only for the sake of the investor but also for the advancement of the entire cryptocurrency space.
Escaping the digital gold label
The stories of miners from 2012 and the early days of Bitcoin, pulling out hundreds of coins off their home PCs and then suddenly finding themselves millionaire by becoming accidental long-term holding investors are all but gone.
Bitcoin’s price is feeling the effects of going parabolic and it has left it in a very big bear market where a lot of the players are new entrants who bought at the highest point. This situation that many people find themselves in- who came to Bitcoin to invest in the hopes of a get-rich-quick fix- is problematic for the investors, and for cryptocurrencies.
Bad sentiment follows the market currently as investors get fed up on unfulfilled promises, pulling bigger and bigger losses as the price keeps falling. It sounds like doom and gloom, and it is, but only for one sector of the cryptocurrency space.
Bitcoin is a store of value, but currently, it is not a very good one, and as such, the digital gold label needs to be divorced from it.
Other cryptocurrencies have tried to find their way as a currency, or as Blockchain solutions, some even as a digital version of the US Dollar, and really, this is where the technology and the cryptocurrency space should be focusing in its energies.
Reasons why Gold is a better store of value
Bitcoiners and newer investors have laughed at Gold as an investment opportunity as it does not have the same headlines as Bitcoin has had in the past. But as a commodity, it is something that should be invested in while Bitcoin and cryptocurrencies are left to advance the technology space.
Gold is of course well established in terms of a market, it has things like ETFs advancing its liquidity, and it is primarily used simply for value. There are applications such as in dentistry and circuits, but predominantly, it is a precious metal which grows in value.
Bitcoin, Blockchain, cryptocurrencies and the entire new wave of technology surrounding this space has a big future that is still being unpacked, and it almost feels as if the investment side of things is a pure distraction.
There is no doubt that the mainstream adoption of Bitcoin came in part because of its exponential growth, which circled back, enticing more users in, but that time is gone. It must now be left to grow organically, with the value surmounting from its application as a new revolution in technology.