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Donny Gamble
November 29, 2021
Gold vs. Bitcoin
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The great debate of our modern time: Bitcoin vs. physical gold. They’re both vastly different forms of currency and investments, which is what makes it such a difficult topic to delve into.

Gold is what we’re told to buy in the event of economic collapse, but Bitcoin is the decentralized currency that defines cryptocurrency—which one is a better investment for you? 

And which one will be more useful when and if we face catastrophic financial failure in the near future? Let’s talk about that.

Let’s discuss the volatility of owning one over the other, what your investment goals are, and how to make the right decision for yourself.

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Gold vs. Bitcoin: Which One Should You Pick?

Everyone has their own investment styles, which is what makes investing in either such a great option. Historically, we can see that gold fluctuates. However, we’ve all lived through the Bitcoin boom, and we’re watching the way it trends now.

Which one ends up being the better option? There’s no telling what will happen if Bitcoin plummets, but we know that gold is future-proof—everyone wants gold, because it’s physical wealth they can touch and hold.

Because Bitcoin and cryptocurrency relies on access to technology and the internet, it’s only worth something if it’s accessible in the event of an economic collapse. That’s why gold is favored here.

If you’re investing to grow your wealth and slowly scrape gains off the surface, Bitcoin would be your best bet. It is truly decentralized, and its standard doesn’t change (much like the gold standard).

For protection against inflation, Bitcoin is superior to gold in its current state. While the historical data is obviously much shorter, nothing has truly presented itself as a decentralized currency like this before.

Bitcoin is a solid investment no matter where you go in the world, where the prices of gold can normally skew

Bitcoin is Secure; Gold is Tangible

As it’s decentralized, no one government or body can tank the price of Bitcoin. If anything, a government making Bitcoin illegal in their country will only drive the price higher, as people yearn for financial security.

With gold, you have to have a buyer, but just about everywhere will take cryptocurrency due to its rise in popularity.

A currency that you can use anywhere (and in varying, fractal amounts compared to bullion) is invaluable. There’s no transfer, either; you don’t actually have to sell Bitcoin like you would with gold.

At the end of the day, you can hold gold in your hands. Bitcoin will never be a tangible asset. Gold is also a finite resource, whereas cryptocurrencies are made nearly every day.

Bitcoin is unique, but it uses blockchain technology just like other cryptocurrency, and is subject to massive drops as more coins are released (depending on if that ever happens).

One fear with gold is that it will become common if asteroid mining is ever a common practice, but as of right now (and the foreseeable future), we don’t have to worry about space mining creating an abundance of gold and tanking the price. We can’t be 100% certain about something like Bitcoin since we can’t touch it.

There are benefits and setbacks to both investment types, and it’s not clear which one will be right for you. Many investors are diversifying their portfolio to include a small share of gold, and a predominant share of Bitcoin or other cryptocurrencies.

This allows you to be future-proof, technology-proof, and still place a majority stake in the cryptocurrency marketplace where you stand to gain more money in both the short-term and long-term.

Market Cap on Gold vs. Bitcoin

We can suddenly find more gold, and flood the market to lower the price. As the population expands and gold is sold/becomes more scarce, the price continues to rise again.

However, Bitcoin is digital, so it’s something that can be expanded upon later depending on how the blockchain changes (even though it’s unlikely). The point is, it’s finite right now, but since it’s digital it can absolutely change in the future.

The main thing to keep in mind here is that the market cap on gold is far ahead of Bitcoin, and while Bitcoin prices continue to climb, they would have to be over $600K per Bitcoin to match or beat the gold market cap.

Which is More Volatile?

Bitcoin has a shorter history, so it can be difficult to say that one is more volatile than the other. Gold has its peaks and valleys over the last one-hundred years, but it always finds a way to bounce back no matter what.

We don’t have the same security with Bitcoin that we have with gold. It’s not time-tested, not quite yet.  Gold is a structured financial decision. For many, it’s boring, whereas Bitcoin offers the potential for making a fortune overnight.

That adds to the volatility, because trends and media will affect how Bitcoin soars and how fast it drops (when the bubble pops). Yet despite all the cryptocurrency bubbles we’ve seen over the years, Bitcoin remains on top.

Overall, you have to look at what you’re able to take as a temporary loss. If your Bitcoin value fell by 45% tomorrow, would it ruin your entire investment portfolio?

Or could you hold out since markets predict that it’s only going to regain and continue to rise? It comes down to the investor, because both investments possess long-term return and stand as investment hedges.

Bottom Line

While gold is a sound investment, cryptocurrency (particularly Bitcoin) cannot be ignored as being a viable, long-lasting option. Both appeal to different investment portfolios and investor types.

You can accrue wealth with both options, but with the way that cryptocurrency as a whole continues to grow, you have a higher chance of earning money from short-term investments as well as long-term investments from Bitcoin than gold.

Bitcoin vs. Gold FAQ's

How is Bitcoin secured?

PoW, or proof of work, is an independently developed technology that is commonly referred to as blockchain. Bitcoin is built on this engine, and utilizes a network of internet assets to ensure it cannot be overloaded (DDoS attacks) to keep everything secure. 

This system was actually used to get rid of email spam in its early inception before being utilized for cryptocurrency.

Bitcoin does consume tons of electricity, though, so much like cotton/rag paper being used for bills or alloys and energy being used to create gold, there’s a cost, which people often don’t think about.

Bitcoin requires a lot of power to constantly work and for people to mine more Bitcoin, so electricity technically powers Bitcoin, as it’s used to keep the blockchain alive.

Who decides the price of gold?

Gold prices are dictated by banks, internal chair members, and a committee. They take supply and demand into account, analytical information, and determine how the future of gold will unfold based on historical evidence and current gold circulation.

Where can I buy Bitcoin?

Online crypto exchanges. Everything is stored on-site or transferred to a digital wallet, where you can utilize it as decentralized currency. While in its platform (Coinbase, for example) it’s a stock that can fluctuate in price and be sold without having to be transferred onto the platform. 


When it’s in your wallet, it is accessible as currency. There are other online crypto platforms such as Crypto.com.

Coinbase

Coinbase is a secure platform that makes it easy to buy, sell, and store cryptocurrency like Bitcoin, Ethereum, and more.

About the author 

Donny Gamble

I’m Donny. I’m a world traveler, investor, entrepreneur, and online marketing aficionado who has a big appetite to compete and disrupt big markets. I thrive on being able to create things that impact change, difficult challenges, and being able to add value in negative situations.

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