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Is A Bitcoin Wallet Holding Digital Gold?

Tue, 06/13/2023 - 09:26
Is A Bitcoin Wallet Holding Digital Gold?
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Bitcoin’s potential as digital gold has been in discussion forums and of crypto experts and crypto investors. Before moving ahead with this article, I would like to answer the question if Bitcoin can be trusted to be the next gold in digital form. My answer is No! Bitcoin can be mined, but it does not make it gold.

I decided to answer the question at the beginning of the article to help you understand how this question arose and what are the possibilities that your Bitcoin wallet is holding gold in the form of Bitcoins.

Despite the volatile nature of Bitcoins, the reason that Bitcoin was addressed as the digital gold for the future was that it was accepted by many countries and governments as an asset more and less as a currency. Similar to gold, Bitcoin is used in many parts of the world for buying things, for investment purposes and much more.

Since Bitcoin is known to the world, many assumptions have been made about cryptocurrency. Many of them were in favor of Bitcoins and many were against this digital currency. Due to Bitcoin's similarities with that gold, many crypto discussion platforms have discussed Bitcoin to be the digital gold of the future.

How true can this be, will always be a question until the future arrives. But I can help you understand if this can be true or not. Or if at all there are any chances that Bitcoin can replace gold!

Similarities And Differences!

Whether or not your Bitcoin wallet holds digital gold is a question that will remain open in many minds. We need to first understand how related are Bitcoin and gold to each other and what are the differences that still add a question mark to Bitcoin being called the future digital gold.

Gold is a scarce commodity and so is Bitcoin. Both have limited existence and this makes them more worthy of investment. Bitcoin mining is well-heard of now. Gold is mined too. And it takes a procedure for gold mining that makes it even more expensive. The same is the case with Bitcoin mining. It has a procedure too that requires a lot of resources.

Bitcoin is referred to as an asset by many countries adds to another similarity between the two. Despite the similarity, some differences put a never-ending question mark in referring to Bitcoin as gold.

Bitcoin is not monitored by any regulatory authority. This puts the investors at more risk. This is a major difference that many experts deny Bitcoin becoming the future digital gold. Another difference is of Bitcoin is very volatile. Unlike gold, Bitcoin’s prices have skyrocketed and crashed to unbelievable levels. Whereas, gold prices fluctuate but not to the extent of Bitcoin.

As an ending note, I understand investing is not an easy choice to make. But just to add here despite gold being more risk-free, people invest in stocks! This is the very reason why it is a good idea to invest in cryptocurrencies like Bitcoin. But one needs to understand the in and outs of how things work in the crypto world. Blind investment will never be a good idea.

And since I have already answered the question in the beginning, whether Bitcoins will be the future digital gold, I still want to add that It is still far from the sight to date that Bitcoin is digital gold. How countries and regulation authorities see Bitcoin and other cryptocurrencies in the future can change the game though. All we can do is just wait for the future to arrive while calculatedly investing in popular cryptocurrencies.


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