Source: Moneywise
Undoubtedly, gold and Bitcoin are two asset classes considered in the financial system of all the countries globally. These assets are used to save the countries from difficult situations and store values like scarcity, divisibility, portability, and durability. Since the day Bitcoin emerged in the USA, it has been considered digital gold by various communities and investors. In this article we intend to make a comparison between gold and Bitcoin, their similarities, their differences and the things to understand whether Bitcoin can replace gold as the ultimate store Of value in terms of its implications, its prices etc.
Let's learn about the relationship between gold and Bitcoin…..
What Are The Similarities Between Gold And Bitcoin?
Gold was invented in 550 BC, and has always been in the global financial system. Even after it has been replaced with the fiat money of various countries, the value of the gold is still there and it rises or falls with the GDP of the USA. The use of gold and its standard has still there in all countries since the early days of 1970.
Over the passing years, gold has achieved a good value in itself. It has several characteristics and has established a reliable store of itself.
Scarcity-Even after having a limited supply of gold on the globe it is said that there is around 30% of the gold present inside the crust of Earth.
Divisible-gold bars can be split into smaller pieces and each of its small pieces can be further used as a medium of exchange. However, there are special equipment required to cut this gold. Even because of certain limitations including the mining of gold, the cutting of gold, making designs, molding, melting etc; every cost has its own importance. After all these cutting, moulding, and other things gold has its own significance and is used as a medium of exchange in human’s daily life.
Portable-gold is known to be a well known resource of a wealthy lifestyle. However, the physical limitations of storing gold applies for every individual or according to the countries rules and regulations. Still, there is a large amount of gold that is used and will be used in future.
Durable-it is one of the most durable commodities that can be used and can be saved for any scarcity or any future crisis. It does not degrade with time and is one of the oldest artefacts that is dated back to 4500 BC.
How Bitcoin Became The Best Second Asset Class In America?
Bitcoin is one of the new asset classes invented and made by Satoshi Nakamoto and was invented electronically, and published in a white paper in 2008. The first transaction related to Bitcoin took place between two men Nakamoto and Hal Finney who were the two contributors of this project. By the time Bitcoin reached October 2009, its value became 2300 BTC for dollar 1.
Though Bitcoin cannot be considered pure gold that can be stored for a long time and for the crisis that the USA may face, it shares a few characteristics that may resemble it with digital gold.
Talking about its durability, Bitcoin is also considered as one of the most durable digital gold that can be used for any USA’s asset class. Additionally, blockchain is the technology that is used behind the making of Bitcoin and as soon as block chain exist the Bitcoin exist and is durable as long as for that time.
Blockchain is considered to be one of the immutable technology because of its “Record Keeping” characteristic. Even if one of the block of this transactional Technology has been approved no one can alter the transaction again or ever in the future.
Just like gold, Bitcoin is also portable in itself and divisible. It can be stored in hot wallet of the internet and cold wallet offline with the help of hardware devices.
Can Ever Bitcoin Surpass Gold In Any Situation Or Vice Vera?
In December 2024 bitcoin surpass the value of Dollar 100,000 in USA and it had the new record high, creating a buzz in the town that the president Donald Trump would make a Bitcoin reserve like Gold reserve and oil reserve. Furthermore, this reserve would be used as a means to normalize the debt faced by the USA and dominates the value of dollar across the globe.
To follow the steps of completing Bitcoin reserve making, Donald Trump passed the bill to create the Reserve as he promised before the presidential election in 2024. But again in March on Thursday (13 March 2025) the Bitcoin price dropped down and the stock market faced a loss. In comparison, the price and the value of the gold surpassed the store value of Bitcoin. In the second week of March, the value of the gold ETF is measured as dollar 3000 per ounce for the first time.
The yellow metal is 1.5% ahead creating a new record high. Over time the value of Bitcoin and its frame has dropped by 20% and the frame of gold or the yellow metal has risen by 1%. On the one hand, in these 30 days the capital inflow of the USA has been increased with the increment in the prices or the Store value of the gold since the early days of 2022. On the other hand, around 5 billion of Bitcoin ETF has been there in the outflow since February 2025 which is further creating a negative impact on the USA’s capital income.
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