{Mark Tencaten} | What Makes Bitcoin a Better Asset Than Gold

Bitcoin was created to resemble gold because it is intended to be a store of value. Throughout the history of mankind, gold has emerged as the best available store of value and medium of exchange. Despite having little "industrial" utility, gold has always been prized by people throughout the world, which is why it makes such a superb kind of money. It is widely available because people have kept it in storage from the beginning of time, yet it is also challenging to get.

Gold is a great value store and a suitable medium of exchange due to all these factors. Due to its relative abundance and difficulty in mining, gold has value and, more significantly, a steady value, making it simple for societies to define their pricing in terms of the metal.

Gold is the closest thing we have to perfect money in an imperfect world.

Because of this, Bitcoin was designed to resemble gold in at least two significant aspects. First of all, there are only 21 million Bitcoin available. Estimates indicate that approximately 201,296 tons of gold have been mined, leaving about 53,000 tonnes in known reserves. The expense of extraction is possibly a more significant resemblance between bitcoin and gold.

As a result, Bitcoin has many of the same qualities as gold, including being useful and accessible but having a finite quantity. Due to the lack of any application in reality and the impossibility of a sudden increase in supply, its value is steady.

Yet, Bitcoin is superior to gold.

Why Bitcoin over gold?

Mark Tencaten thinks that investing in gold is a bad idea and that Bitcoin could be a better substitute.

Both Bitcoin and gold can be used as a store of value. However, Mark Tencaten thinks that, unlike Bitcoin, gold isn't a particularly secure investment to use as a hedge for economic uncertainty because, in the case of a huge economic disaster, someone could "murder you and seize your gold bar." He views investing in gold as "useless" due to the possibility of having your actual gold stolen. Bitcoin also serves as a store of value in contrast to the precious metal, which is "secured by a digital ledger." As Bitcoin is a virtual currency, no one can take it from you if something goes wrong.

There are similarities between Bitcoin and gold, such as the limited supply of both throughout time and the actual metal, which has led many cryptocurrency fans to believe that Bitcoin will someday become a digital form of gold. According to Mark Tencaten, Bitcoin might be an even better investment than gold for use as a valuable asset.

Nonetheless, there are also significant distinctions between them. A global monitoring system monitors gold and has long been regarded as a safe asset. Its track record is better established. Contrarily, institutional investors have embraced Bitcoin, a more recent alternative investment that is the most well-known and well-respected of the cryptocurrencies.

If you are choosing between two investment possibilities, it is imperative that you comprehend their respective characteristics. Yet, for a few crucial reasons, it's highly feasible that no other investment could be your best choice.

Mark Tencaten suggests that you should constantly be sure to invest only in items you understand. However, investing in cryptocurrencies and precious metals may both be quite dangerous and confusing. So, suppose you are unfamiliar with investing in them. In that case, you should avoid both of them in favor of more straightforward options that are available in the trading account, such as index funds that follow the performance of the stock market as a whole.

Even if index funds that track the market might temporarily drop in value during a recession, you shouldn't invest for the short term anyway. Furthermore, Bitcoin and gold assets actually carry a far lower long-term risk of loss than any other investments, suggesting that they might be a better investment for most investors than any other options.