Digital Gold in the 21st Century

Author:Jones time:02-19 16:37 source:Internet 825 views Mining

People are always looking for assets that are not controlled by the government. Gold has played this role for centuries, but Bitcoin is playing the same role as gold now. Since its inception in 2009, Bitcoin has often been compared with gold, gaining people's recognition in the name of "digital gold". Analyst Laboure believes that Bitcoin has the potential to become the digital gold of the 21st century.

Bitcoin has investment volatility,it will remain super volatile for the foreseeable future. But gold is also historically volatile. Bitcoin is the most traded cryptocurrency. Its market cap is much higher than the market cap of the second largest Ethereum. Some people also think that Bitcoin is digital gold and Ethereum is digital silver.

Changes in the value of Bitcoin and gold may give us a clear picture of the relationship between them. Earlier this year, the cryptocurrency market took a nosedive, with the total market capitalization falling below $2.2 trillion. At the same time, the price of gold also fell.

Bitcoin shares some characteristics with safe-haven assets like gold, such as scarcity. Bitcoin, like gold, has little correlation with traditional financial markets and is not controlled.

In some ways, Bitcoin has performed better than gold as an investment. An asset return report showed that Bitcoin ended 2021 with a 66.5% increase in total returns, making it the best performing asset class for the third year in a row. Bitcoin has outperformed a variety of other assets, including gold, Treasuries, and stocks, among others.

It is worth noting that the difficulty of mining Bitcoin is increasing now. According to CoinWarz, the Bitcoin network mining difficulty reached a new high of 27.97 T. This is yet another time when Bitcoin mining has reached a difficult point.

Last month, Jeremy Siegel, a professor of finance at the Wharton School of the University of Pennsylvania, said that bitcoin has replaced gold as an inflation hedge for many young investors, and that bitcoin is the digital gold for millennials. Analysts predict that Bitcoin will outperform gold despite gold’s upside potential in 2022, largely driven by millennial activity. Bitcoin has replaced gold as the store of value for millennials.

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