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Bitcoin Vs. Gold

bitcoin vs. goldLarge-scale monetary inventions are not exactly common. Thousands of years ago, the first individual to discover and make use of the gold monetary qualities didn’t imagine in the slightest the magnitude of the productive explosion this invention would trigger in the centuries to come. In fact, thanks to its physico-chemical properties, wide geographic distribution and low ratio of annual production and low inventory stock, gold remains the currency par excellence and perhaps the only reliable means to extinguish debt in the current context.

Gold passed the test of time because, through the ages, it has done very well as far as its monetary functions are concerned; which, of course, does not mean that cannot be unsurpassed. Here are examples of some of the disadvantages of gold as a  means of value preservation and  a medium of exchange:

→It is relatively easy to fake.
→The amount of gold in any given currency may be altered (as history has shown us many times).
→Small units (e.g. thousandth of an ounce) are not suitable for everyday exchange.
→With frequent use some of value is lost due to wear and tear.
→It is difficult to transport large quantities of gold safely.

I would, therefore, venture to say that a Bitcoin is objectively better than gold coin; much in the same way gold coin is objectively better than salt. Why, then, is Bitcoin not as widely accepted as gold? For the same reason in 1974* email was not as widely accepted as the traditional mail service.

* The email was created in 1971.

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  • Cos

    I don’t disagree with you, but some of your points are false.

    “[Gold is] relatively easy to fake.”

    -> This is just not true. if it were true, gold would not be the currency of choice for thousands of years. With careful enough inspection, gold is nearly impossible to fake.

    “With frequent use some of value is lost due to wear and tear.”

    -> I think you mean gold gets lost and worn out quantitatively, because it does not lose qualty. If this is the case, then the same is true for bitcoin. Every lost private key leads to lost coins.

    Bitcoin Q&A: http://ask.fm/AskBitcoin

    • Larry X

      I stand by my statement; relative to Bitcoin, gold is indeed easy to fake. Wouldn’t you agree?