Topic: Bitcoin vs. Gold - is market cap parity utopian? (Spoiler, no!) - page 3. (Read 1100 times)

I didn't say that the appeal of Gold has come to an end but it's nearing the end of it's popularity like it has been in the past

Sure, gold is a valuable financial asset and i do not argue the fact that a lot of people still sort after it and even though bitcoin has become a developing asset that will take over from Gold but it is understandable that there are people who will still choose Gold over bitcoin maybe due to affordability or just a normal love for Gold than bitcoin and moreover since there are people who could not afford Gold that's also same way there will also be people who may not afford bitcoin.

Bitcoin has shown good moves in recent years so it does not matter how long it will take to be considered as the best investment ever even though it's still developing.

To be fair, bitcoin is a worthy competitor to gold but it is still too early to say that the appeal of gold or the era of gold is over and now it is the era of bitcoin and crypto.

We should be realistic that bitcoin is still not as popular as gold, and gold is still the top choice of governments and major investors. As far as I know, countries like Russia, China and many others are still buying gold in large quantities, not bitcoin. That shows they still value gold more than any other asset for national reserves. Moreover, the demand for gold is not limited to being an asset or investment but it is also applied in many industries. So I think gold may no longer be an attractive investment but it is still a safe haven option, a hedge against future inflation.


As for bitcoin, it is considered the best growth asset ever, so it can surpass gold, but that will not happen in the next 1 or 2 years. We need more time for bitcoin to take over and become the best investment.

One of the things that is inevitable in life is revolution because that is what keeps the world advancing so i think the era when gold was seen as the most valuable asset is coming to an end since bitcoin has now surfaced and bitcoin will also continue to be in dominance till maybe something else evolve and also subdue the value of bitcoin but for now i doubt if there is anything than can contest in worth and values as bitcoin. Gold has been in dominance since 600 BCE so it's time for it to give way to the greatest invention of our time (bitcoin).

Buddy, gold is a dead rock, and it's getting demonetized, because it's no longer the best money. Back in the gold standard, and during the 20th century, it was the best money, but not anymore. It's not just Bitcoin, it's the fact that technology advanced, and we can extract gold much easier and in larger sums than before. This factor makes it less good as a money.

But even without that in mind, Bitcoin has been rising by more than 100% every year on average, for the last few years, while gold has remained the same more or less. That, alone, should answer your question.

For starters, you misrepresented the point, if you reread what you replied to from the beginning, you will realise that I wasn't talking about ROI possibility but the market capitalization, Gold is compressed to avoid inflation, so it can never beat Bitcoin in ROI with its current structure.

Nevertheless, it's my choice to put all my money in Gold but my experience in investment will not allow me, and a big Thank You for that advice, you deserve it. And if you must know, I invest more in Bitcoin than Gold for the higher ROI possibility (simple wisdom). But that will NEVER blind my eyes to the truth, unlike many others.

And when it comes to the asset that won in market capitalization, Gold has it, which was the genesis of this discussion unless you have different statistics from the one known by the world.

Through the years, we have had similar gold pumping and bitcoin naysaying discussions and the gold holders have not done too well as compared with bitcoin, so sometimes it is surprising to see those same largely debunked arguments reviving themselves.

Good luck with your gold investment (relative to bitcoin) you are going to need it.

Hopefully, you are not so short-sighted as to be putting more than 10% of your value into gold as compared with what you put into bitcoin (and even 10% relative to bitcoin might be a bit high), yet of course, you are free to allocate your time, energy and value however you like and see how it fares for you.

Nothing reads 14x in what you replied to, it's all about the market capitalization of Gold and Bitcoin. If Bitcoin rises 14x, will Gold remain the same? It's a simple arithmetic.

Really? That's a misconception, over $12T worth of Gold has been mined so far. But let's pretend such a huge worth has not been mined, don't you think more people will still prefer Gold because it is a name with physical representation than Bitcoin which is entirely virtual?

https://www.gold.org/goldhub/research/market-primer/gold-market-primer-market-size-and-structure.

You have not presented any reason why both gold and bitcoin is smart and/or why the holding any gold is actually smart, especially when bitcoin does almost everything that gold does, except better.  Perhaps the ONLY reason to hold gold is for Armageddon purposes, or perhaps if there is already a good gold network in your geography... .. yet there maybe quite a bit of prudence, even for the guy choosing to hold some gold to actually mostly move over to bitcoin with 90-95% of his value in bitcoin and perhaps at most 5% to 10% the value of his bitcoin holding might be permissible to hold in gold for Armageddon or whatever outsided scenario that is anticipated in which bitcoin might not be a possibility.


Huh?  Gold had largely been stagnant and losing value in the past 13 years or so, and surely in the past year, Gold has shown some life, but still does not necessarily mean that gold is a good place to put value in ways that bitcoin is not going to be better than gold.

If you had not noticed bitcoin is around 1,000x better than gold or perhaps more than that in terms of various aspects of moneyness, including but not limited to verifiability, portability, scarcity, divisibility, ability to use without third party interference and/or great costs and some other features too.


Gold will prevail how?  You mean continue to survive for a while during the time that institutions, governments and individuals are recognizing and appreciating that bitcoin is better, not only in terms of bitcoin already having had increased in value stupendously compared with gold and that the trend of bitcoin eating gold's lunch is going to be continuing, and yeah, sure gold will survive and flail compared with bitcoin, and maybe gold will do better than the dollar, though the dollar is not a very good measuring instrument.. .are you wanting to say gold is going to do as well as bitcoin in terms of hookers, lambos, blow and other real world goods, services and properties (such as real estate)?  I have my doubts, especially if you might consider pricing gold in terms of bitcoin rather than getting distracted into poor measuring sticks such as pricing in dollars (or other fiat).


yes they can.  Gold is inferior to bitcoin, and bitcoin has been eating gold's lunch and will likely continue to eat gold's lunch in terms of monetary premium kinds of measurements... but sure, you can choose to live in a fantasy and act as if gold is holding its own and blah blah blah, when it is not.  It is not holding its own in any material, meaningful and/or substantial way in comparison to bitcoin.


Gold is intrinsic because it is physical?  Get real... that is not sufficient, even though gold might will serve better than bitcoin during certain kinds of Armageddon scenarios that might end up happening.. perhaps.


Good luck with your distraction into believing that your gold is going to come even close to giving you as much stability and/or appreciation in the coming years.. and yeah, maybe you might want to discount me for considering bitcoin having more pumpamentals in terms bitcoin being in early stages of adoption, and sure yeah there is some unfairness in that, yet if you have some kind of clue about what bitcoin is, then you better be careful if you are allocating much more than 10% of your networth or  portfolio value into gold as compared with bitcoin... ... so whatever allocation that you have gold/bitcoin, you should be considering no more than 10% of the value of your bitcoin into gold.. but hey whatever you can do what you like and have fun staying poor in terms of bitcoin quite likely continuing to eat gold's lunch in terms oof the more sound money and the Gresham's law type principles in which the soundest money is spent last (which happens to be bitcoin and people are increasingly figuring out bitcoin in regards to its superiority to gold.. it is not just a "young person's thing" as you are trying to dismissively and erroneously framing bitcoin in such ways).

Capitalization doesn't require any extensive explanation as to how the term is defined. You could argue that the reasons for a certain capitalization to have emerged in the first place is complex and multifactorial. But this is where your post becomes interesting: it took gold thousands of years to build a market cap of say $17 trillion. It took bitcoin 15 years to build a market cap of $1.3 trillion. I am oversimplifying a few matters here, but you get the basic idea. Bitcoin got attacked 1,000s of times, by hackers and we don't even know by whom, but certainly by forks, by alt coins, by governments trying to regulate it to death via prohibition. And it still exists, is thriving and people around the world entrust the network with $1.3 trillion as of now. When people realize that it can handle that amount without taken down, the network is due to grow further.

In other words, the longer history that gold can look back on didn't hold bitcoin back from growing at an impressive pace, unprecedented pace. Considering this is a technology that nobody can ultimately control, I find that quite impressive. There is no person that arbitrates between parties like an Amazon customer care agent, but people started to understand that this job is done by a decentralized network in the fairest manner possible. Fully neutral via algorithmic determination. There can be now judge in the world being as neutral as the bitcoin network. Those things are complex and not easy to grasp for folks who get first involved with it.

Gold is easy, but make no mistake that many people don't know what purposes it serves beyond being used for wedding rings. But compared to bitcoin, I think gold has a lot of flaws. The degree of freedom it provides to you is close to zero if we define freedom by flexibility and capital mobility, being able to leave a country, being able to pay someone across boarders, being able to legally hide value from whomever, being able to protect it from confiscation, being able to split it in smaller units or aggregate it into bigger units as you wish, remain solvent and able to pay for things when your bank accounts got frozen, being able to shift value from inflationary assets to a stable or deflationary asset, being able to anonymously/pseudonymously transact (if you do it correctly), being able to fund causes important to you without getting caught or transactions getting blocked or you getting excluded from the financial system forever, etc....

There are so many things to mention why bitcoin is ahead that in my opinion the history that you are talking about only proves the point I mentioned above. What took gold thousands of years, bitcoin was able to build similar levels of trust in about a decade. We've already entered the range of trillions here. Yes it is still 13x or 14x, but that doesn't matter as much.


That is your opinion and I won't say that your personal, subjective point of view is wrong. But "it is no secret" sounds like quite a superlative to me and I am sure there are people who don't own a single ounce of gold, but thousands of bitcoin. But I would not call them "not smart" or "less smart" than someone who owns both

I think capitalization is something that is quite extensive to explain, but it is necessary to point out something, gold has a much longer history than BTC and that is something that has weight, now BTC is the asset of the future and many young people prefer BTC more than gold itself, so everything is a matter of changes in the world, the most accepted without a doubt is gold, but the most desired worldwide is to have BTC, both represent money and it is not a secret that having both is the smartest.

At the market level, gold has gained a lot of value, BTC too, BTC is expected to be the most important asset of the future and even so, gold will prevail, I would say that they cannot be compared, there are many intrinsic things that are different between the assets, much less put one against the other or in the form of competition, for me both are safe havens of value.

We don't even have to go to 2012 to make it look insane! Just have another look at my excel table in the first post, we have been at 1,287x in 2015 and 665x in 2016. It decimated the gap by 50x since then. This is still out of this world and bitcoin has been outperforming all asset classes for such a long time that even a year of two of consolidation and sideways movement is irrelevant, or maybe rather a good sign as it had tons of volume and it means that there is either some redistribution among folks around the world, or there is some very strategic accumulation going on. But the volume is there and it is not there because people have fun buying for 65k and selling for 65k the next day.

Gold currently represents about 3.6% of wealth. Bitcoin currently represents about 0.276% of global wealth. If I had to make a bet whether gold goes 10x first or bitcoin goes 10x first, I'd know in which basket to put my eggs. Gold has not much room to grow for very practical reasons. Of course if you are a billionaire and hold a few tonnes, it could still double in price or maybe triple and it is worth it since you are already rich. But where should it go? 33%, one third of global wealth? I know that global wealth can and will increase overall and then the relative numbers are a bit different. But as of now, bitcoin is the call if you want some substantial upside opportunity.


Peter Schiff is amazingly ignorant and twists the truth and other peoples' reasonable arguments by so much that I am sometimes shocked how he never gets lost for words... but to his credit at least the guy has a true agenda. He is talking bullshit for a reason.

@EarnOnVictor are you running a precious metal dealing company or are you sitting on a ton of gold? Then I would understand your fact denying approach to understanding bitcoin's potential. But if you are ignorant for no reason, then there are other issues that I can't exactly name.

In comparison to gold, bitcoin is winning MOAR bigger than gold, even if we start the measurement from 2012 rather than going to bitcoin's first few years of having little to no price... So even if we start bitcoin from $5 per coin in the beginning of 2012, it should be pretty fucking obvious that bitcoin has been kicking the shit out of gold, and any reasonable inference is that bitcoin continues to kick gold's ass and will likely kick gold's ass in the future.

So if you want to be a dumbass and consider gold to be either superior to bitcoin or even equal to bitcoin, then you can have fun staying poor if you choose to allocate in that kind of way or even if you choose to allocate anymore than 10% the size of your bitcoin holdings to gold, then you are quite likely failing/refusing to understand either bitcoin or gold, its current role in society and its likely future role in society... including that bitcoin is likely in the ballpark of 1,000x or more more valuable than gold in terms of its market cap and bitcoin currently has a market cap of about 1/15th the size of gold, so even if it might take 50-200 years or more for some kind of a reasonably more accurate reflection of the relative market caps of each (bitcoin and gold), you may well be uninformed and/or in a fantasyland if you continue to believe that currently gold is a good or even anywhere close to as good as bitcoin as an investment.


If EarnOnVictor is so dumb as to invest/trade in accordance with his dumbass proclamations, then surely he is going to be faced with a pretty damned high likelihood of having fun staying poor (relatively speaking).. Him and Peter Schiff.. to the extent that Schiff might also be investing in accordance with his proclamations of the supposed better value of gold versus the worser value of bitcoin.  Surely, some folks might not be so dumb as to actually invest (or trade) in accordance with their nonsensical (lacking in evidence/logic) proclamations.

It is good that you bring up the 14x multiplier because that is what I was trying to convey and what EarnOnVictor seems to not understand.

We went from a 5.66 million multiplier in 2010 to a 14x multiplier today. It is astonishing to see people ignoring those facts.

@EarnOnVictor, you registered just recently, but can you imagine what you would have said in 2010, 2011, 2012...,2016, etc.? The multiplier in 2016 was ~665x. Then the multiplier got decimated again within just two years to 50x. Guess what, it got cut down by almost 4/5th again until now (and a couple of times in the meantime).


Sorry dude, but I trust Bitcoin more than I trust you for very good reasons! You better use all your BTC to buy gold then! I mean you are still around here on the forum trying to make some BTC, huh?

I like how you said


As if that alone wouldn't be already insane. Try to create something out of thin air that is worth $1.3 trillion within 15 years...

This is not about Gold won now, Gold has been winning before our ancestors were born and it will continue to win because it is better preferred as a safe-haven asset during uncertain times, the physical presence is contributory as well. Like I earlier said, I do not want to compare Gold and Bitcoin again for many reasons, but still, I fault your statement that "I'm sure Bitcoin will beat the "gold's volatility"" without adding the provable/constructive reason why such will happen. We should stop living in the fantasy of what we believe will happen but what is feasible and provable.

Yes I agree with you, gold is winning right now due to global volatility, but Bitcoin really has tremendous potential. We are about to see a big bull market very soon, the Bitcoin market is going up again, and there is a very good chance that Bitcoin will become much more viable in 2025. Right now the stability of gold and sustainable income from real estate will appeal to many over Bitcoin, but in the future Bitcoin will be the most profitable.

And if we see Trump as the winner of the US presidential election, Bitcoin will definitely become more likely, because he has been announcing that he will support crypto for a long time, so we are sure that if Trump wins, Bitcoin will definitely go much further. And then Bitcoin will outperform everything including gold and real estate.

You don't believe Bitcoin can do a 14x, when it's been doubling every year on average for the last few years?

The physical value is only a tiny fraction of its monetary value. Gold is valuated at where it is, because it has had the best money properties until 2009. Same like, Bitcoin is valuated at where it is, because it is recognized as the best money in terms of monetary properties. It is not valuated at $1T, *just* for being peer-to-peer cash system.

Gold won due to global instability, that's why the gold price rise really high in this year. But, I'm sure Bitcoin will beat the "gold's volatility" in the next year since we're heading to bull season, if gold price can rise for 25%, Bitcoin will make it 100%.

That's true Bitcoin not yet become the safest asset for Average Joe, most still think gold and real estate are the most promising.

I'm done comparing Bitcoin with Gold, Gold will win some and Bitcoin will win the others, it has always been like that. I am also not one of the people who believe Bitcoin will meet Gold in market capitalization, and my reason is mainly that Gold has the physical value that Bitcoin doesn't have aside from the fact that it has existed for so long to have built the trust of the biggest guys in the industry.

Can you see the way Gold has garnered more trillions of dollars in just a year? Bitcoin couldn't even hit $1.5T till now. We should be realistic, Gold is so valuable and people will continue to hold it dear regardless of how we may pretend and it's not everyone who will trust the virtual Bitcoin, ever, trust me.

This part needs an addendum and some clarification.

Using the term "dominance" is wrong in my opinion. The correct term is market cap ratio. They basically took bitcoin's solo market cap and divided it by the sum total of an increasing number of shitcoins' market caps. For example right now there are about 10000 altcoins listed on coinmarketcap.com so that is 1/10000.

Additionally it should be pointed out that market capitalization is the wrong factor to even consider when it comes to altcoins because we have no way of knowing their true circulating supply (eg. ETH has 72 million premine most of which is not in circulation) and they can "print" billions out of thin air (you create a token virtually free with billions as its supply and with only $1 dollar price that is billions of dollars of market cap out of thin air).

Another reason is because compared to 2017 for instance, a lot of those shitcoins have died and a lot of the super hyped up and pumped shitcoins like ethereum got dumped hard. Lets not forget that ETH was once worth 0.15BTC and it is now only 0.039BTC.

I agree that there is no need for "gold money" doesn't need to come into bitcoin for it to go up since bitcoin has its own adoption but it is possible that because bitcoin is a new "asset" that people are investing into and as an excellent option for diversification, they put some of their money that was supposed to go into gold into bitcoin instead.

Besides lets not forget that the only reason why gold has been soaring over the past years is the global tensions and the fact that countries like China, India and others have been on a gold buying spree amassing large amounts of it in their vaults expecting the global conflicts to grow and the global economy to become unstable.
That means if all global tensions were to end today, in 3 to 6 months gold would crash hard while bitcoin would soar much higher than anything we've seen so far.

This is actually a good clarification regarding the term "winning". Yes, it is about the mechanism. But you could even overstretch the term "winning" as to call those winners who lose the least. No point of contention here though, the dollar will make you lose significantly. The scarcity aspect of BTC can't be replicated, neither can it be ported into another cryptocurrency as we have seen with all those forks. You can port the data and the balances, but you can't port an entirely genuinely grown network and BTC does have that advantage because it was under the radar for so long.

But the point of my post wasn't so much about a general comparison again because we have seen plenty of times. What I found interesting is rather the excel part and how quickly mBTC approached the value of 1 ounce of gold. That is why I put in some effort into the standardization as I admit, I wouldn't have thought myself about 10 years ago that 1 mBTC would become so valuable so quickly. In hindsight yes because this is the effect of decentralization and being open and public, everyone around the world can buy it somehow and keep it.

And then I saw so many threads who said at 1k that it won't go to 10k and at 10k it was said it can't go to 30k etc. That's why I thought the mBTC - oz. comparison could be interesting.

I added some data points like global wealth because some people (how I perceive it) think that a large chunk of global wealth privately held is parked in gold. But it's relatively small with around 3%. Considering this and then the trend towards digitization and all the needs and wants people have in terms of capital mobility and value preservation, I think BTC has a long way to go. It was mostly to give some people who have their doubts a bit more data to base their own conclusions on. I believe that the majority of the forum couldn't tell from the top of their head how much private wealth there is globally and how BTC relates to that.

A trend I am also observing is that more and more young people would get interested in BTC, but not so much in gold. If this generational change from physical to digital assets continues, then that is another catalyst for the price.