If we think from the perspective of an investor, then you have to think mostly of investing in gold rather than in cryptocurrency. Gold is traditionally considered an asset and a precious metal. This also includes the losses in economic trends which is very much possible in crypto but the price of gold has also experienced its loss in the economic crisis during COVID-19. In this article, we shall see one of the top debates i.e., crypto vs gold.
In recent times, during COVID-19 we have seen a huge demand for assets. Some people have lost their jobs and had to use their assets and savings to survive in this difficult phase. Common people think investing in gold is much more beneficial than investing in Crypto. This is an old-school concept that is on-trend to date. However, after the recognition of crypto, it has gained a lot of support from investors as well as common people. It is showing a good rise and proving to be a good investment method.
The debate between crypto and gold is one of the latest topics of the 21st century. Let us look at certain points and next you can decide which you would prefer to invest in.
Crypto vs Gold:
- Gold is highly regulated and has very low chances of getting leaked. Also, you won’t be allowed to cross borders with gold across various countries. While investing and purchasing gold, you will need to look for registered dealers or suppliers. It is always preferred to buy gold physically and store it in a safe place. Nowadays, you can also buy gold online but that includes higher taxes.
- Crypto is equally difficult to steal and fake because of its encrypted and decentralized system in the market. It has the legal license to use across various countries except a few. However, there is a small gap between the regulatory infrastructure that does not ensure the safety of users. Also, the unknown nature of cryptocurrency makes it challenging for customers to regulate.
“Money manipulation is the root of all evil, you can manipulate fiat but you cant manipulate bitcoin.”
– Gun Gun Febrianza
- Gold can offer various applications which includes luxury item, currency, investment, jewelry, electronics, and much more. Crypto has a limitation in its utility. Currently, this is only used as a digital currency and an investment. But there is a chance for financial transactions known as decentralized finance which will emerge in some time. crypto has fame in the field of lending, borrowing, and a chain system business. Also, this has chances to become valuable and powerless just as gold.
- As predicted, by the year 2140, there will be no more crypto released. crypto is a limited asset that will stop being released after a certain year. Similarly, in the case of gold, it is a natural element and will run out of stock approximately by 2050. There are chances of scarcity in both fields regardless of the quantity it is available at this moment.
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- As said by experts, both digital assets and gold are volatile. However, the prices of both have chances of rising and falling based on demand and supply. Recently, after the evolution of cryptocurrencies, several other alternatives have been launched which provide more stability than crypto. Investment in crypto and gold depends on your interest and speculation level. If you are a person who likes taking a risk and has the potential to lose money if the market turns then you can invest in crypto. Also, you can take advice from a financial adviser on whether investing in crypto is a better option or gold.
- The new age cryptocurrency is giving better returns than gold. Therefore, gold has seen a huge loss of much of its importance in 2021. Gold has lost its pricing from Rs. 56,000 per 10gm in August last year to Rs. 46,450 currently. India, the highest holder of gold, saw a rise in investment in Crypto in the past year.
“Bitcoin is sovereign wealth while everything else is conditional wealth because you are not in charge of anything.”
– Olawale Daniel
If we compare in terms of rarity, then both crypto and gold are rare. However, not everyone has the knowledge and proper understanding of cryptocurrency. In Indian families, gold is considered good luck to the family. So, during some festivals, Indian families are more interested in buying gold as an asset rather than investing in crypto. Gold is a rare metal and crypto is also rare as compared to other cryptocurrencies. So, both their rarity depends on their respective category.
- In recent times, people have started investing in crypto realizing that crypto has registered 100 times improvement over gold. In terms of gold, the yellow metal cannot be manufactured by anyone on its own. Like gold, there is also a limitation in crypto.
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Crypto vs Gold: Both gold and cryptocurrency have their respective demerits and merits. It solely depends on the investor’s preference where she/he wants to invest. Now, the market is mostly concerned with the performance of equity markets which have been attracting a lot of capital flows and reaching new highs each week.
Cryptocurrency at a point has delivered and seen a high rise of investors and better returns than any other investment class. As explained by Sen, gold, and cryptocurrency are not strictly comparable investments. This is because gold is considered a historic and important asset while cryptocurrency is not proven once at this moment. However, as per all the resources, cryptocurrency is worth trying and giving a chance. There was also about crypto vs gold, check for complete resources for both the investment type and decide accordingly.