For a very long time, a particular form of conversation is gaining ground in crypto circles. This conversation revolves around the nature of Bitcoin, and whether it can replace gold. In recent times, Bitcoin’s ability as a solid hedge has attracted the attention of investors, who feel that the crypto stands to become a stable hedge in the future.

In this article, we are going to look at whether this is a mere conjecture, or is there any truth to the matter. We will also look at some properties, which has made investors proclaim Bitcoin as the new ‘digital gold’. Finally, we will look at either side of opinions and see what supporters and critics are saying.

Bitcoin and Gold: Similarities

One of the first things, which we should discuss, pertains to how Bitcoin is similar to gold in some important respects.

Both Bitcoin and Gold are available on earth in finite or limited quantities. This means that they do not have unlimited supply. If you do not have limitless supply, the value of an asset is fixed as a store of value.

Both Bitcoin and Gold can be easily transferred across countries and continents. In other words, they both enjoy universal acceptability. You can exchange your gold for currency in Russia, in the same way you can in Puerto Rico. The same holds true for Bitcoins as well.

Can Bitcoin emerge as a credible ‘Store of Value’ in different countries?

One of the major arguments, which is being forwarded pertains to the development of Bitcoins in the developing world. If you are familiar with the economic situation and financial happenings in the underdeveloped world, you will realise how their currencies suffer from extreme volatility.

This means that a pound of bread could be worth 10 or 1000 within one week. As a store of value, Bitcoin could help remove this volatility and stabilise the economy in a major way. Experts point out currency losing value is not only a concern for the masses.

It is also very bad news for governments and central banks who have to exchange their currencies to buy global supplies like oil, food and medicines. Another major reason contributing to the push for Bitcoin over Gold are the Millennials and Gen Z.

The above generations are products of a digital economy. They shop, eat, travel online and expect their currency to be virtual also. This makes them the generation who is going to call all the shots in the near future. In other words, for the younger generation, it is all about crypto. Visit bitcoin up if you are interested in bitcoin trading.

Bitcoin cannot replace Gold: What are the sceptics saying?

There is no doubt that Bitcoin still has a long way when it comes to replacing gold. However, critics who believe that Bitcoin can never achieve that distinction based on concrete points.

They point out that the underdeveloped world does not have access to electricity and the internet at all times. In such a situation, it is practically impossible to have a currency system, which has at its foundation, electricity and the internet.

Another reason that they put forth is the fact that gold has different uses apart from just being a store of value. For example, gold is extensively used in jewellery making. It also finds rampant use in industries like electronics, and medical services like dentistry.

However, to counter the same, Bitcoin advocates use the Blockchain technology argument, they state that modern communications, payments and supply chains can be built using Blockchain tech.

Conclusion

Whether, Bitcoin will ever be able to replace gold is something, which only time will be able to tell us. However, going by the initial responses, Bitcoin continues to show us a promising future. We will all have to wait and see whether we are able to see this reality within our lifetimes or not.