July 17, 2024

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Here Is Why Bitcoin Is a Better Investment Opportunity Than Gold

2 min read

It’s been a great time to be an owner of Bitcoin (CRYPTO: BTC). Since the start of 2023, the top digital asset has soared 307%. The approval of spot exchange-traded funds (ETFs), as well as the April halving, were recent catalysts.

Investors might be surprised to know that gold is also near record highs thanks to bullish sentiment. Bitcoin and this precious metal are often compared to one another. But the leading cryptocurrency is a better asset to own.

How Bitcoin and gold are similar

Market participants like to compare Bitcoin and gold. Therefore, it might be worthwhile to first understand some similarities between these two.

Scarcity is something investors should be mindful of. Etched in Bitcoin’s software is a hard-supply cap of 21 million coins. And in the Earth’s crust, there is a certain amount of gold.

The prices of assets that have a fixed supply should, in theory, rise as demand also grows. This basic economic principle helps explain why gold has been viewed as a popular store of value over long periods of time.

Additionally, there is some utility here as well. Gold is used mainly in jewelry, but it does have a presence in certain industrial settings. Similarly, Bitcoin’s value arises in it being a totally decentralized network with no single entity in charge, thus cutting down transaction costs while sending money to someone across the globe.

Bitcoin’s edge

At a high level, it’s easy to see how Bitcoin and gold are both scarce. Moreover, they both have utility in different situations. But if we dig deeper, we’ll easily see how the top crypto is a superior investment.

Let’s go back to the topic of scarcity. Investors might think that gold has a fixed-supply cap, but this couldn’t be further from the truth. According to the U.S. Geological Survey, 77% of all the gold in the Earth’s crust has been mined. Consequently, there is a sizable amount of gold still left to be mined.

If, for whatever reason, demand for gold shot up in a short period of time, mining…

2024-06-16 14:35:00

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