Bitcoin vs. Gold: The Investment Supremacy
SEC's Move Shakes the Crypto World: Will Bitcoin Replace Gold?
One of the primary questions we often receive is: What would happen to gold if Bitcoin were to truly establish itself as a store of value? Are they compatible, or do they have nothing to do with each other?
Today, we aim to shed some light on this matter, especially in the wake of the recent turmoil in the crypto world during the last week of September.
First and foremost, let's provide some context about what happened just over a week ago. The SEC decided to delay the launch of Bitcoin Spot ETFs.
If the futures ETF was already a monumental achievement, the spot ETF would truly revolutionize the digital financial world. If this new instrument were approved, everything from pensions to mutual funds could suddenly find themselves relying on Bitcoin's continued success. The community and its enthusiasts would remain as free as ever to acquire, sell, and spend their bitcoins.
Additionally, such ETFs would have a direct impact on Bitcoin's volatility, reducing it considerably.
SEC's Regulatory Hurdles
The primary obstacle to this significant development is the U.S. Securities and Exchange Commission (SEC), a federal regulatory body that must grant final approval for a new product like this to be declared legal.
Several congressmen have asked SEC Chairman Gary Gensler to provide justification, and all he could offer was, "it's an arbitrary and capricious ETF." Call me crazy, but that doesn't seem like a compelling reason.
This decision is something we already expected; in fact, the price of Bitcoin hardly wavered.
Many times, we have been accused of having biases, which may be true. What we are absolutely certain of, though, is that we don't know anyone who has studied the principles of Bitcoin and doesn't see its real potential.
Regardless of whether it becomes a $200 trillion asset, as we discussed in this article, we know that its price is well above $250,000.
For this reason, it is worth having such an asymmetric asset in any portfolio.
The greatest appeal of gold has always been its scarcity. This has led major governments to store it as a reserve for thousands of years. If Bitcoin enters the market with the force we believe it will, what will happen to gold?
It's a great question, and a difficult one to answer. To be honest, following the Lindy effect (I encourage you to study it), it's impossible for gold to lose its status as a store of value.
Just as with luxury watches, gold is something that collectors have been clamoring for a long time, and this is precisely what it will remain—a visible symbol of status.
Gold in the Portfolio
All our subscribers have access to our asymmetric portfolio, where we share our portfolio in detail. One of the main exits on September 25th was silver. We believe that in the short to medium term, it has lost its momentum, and we will do the same with gold if we notify it.
The strongest narrative for Bitcoin is that of "digital gold." There is no doubt about that. Investors can support the idea that BTC is designed as the ideal store of value for the digital age.
Scarcity. Confirmed. Durability. Confirmed. Divisibility. Confirmed. Portability. Confirmed. Decentralized nature. Confirmed. Fungibility. Confirmed.
Gold and Bitcoin share many characteristics. The main difference is that Bitcoin is a native digital asset, and its properties are backed by code. Also, Bitcoin is around 14 years old, compared to gold, which has been used in the same way for millennia.