by Peter Schiff, Schiff Gold:
In his latest podcast, Peter Schiff illustrates the important differences between cryptocurrencies like Bitcoin and a gold transaction account like Goldmoney when it comes to convenience and preserving wealth. Essentially, it comes down to the technological risks and the price volatility of the underlying currencies. Here’s a breakdown of Peter’s major points:
One advantage cryptocurrencies have over physical precious metals is the ease of transaction, but it comes at a cost. Bitcoin is a completely digital currency, so you can spend or transfer it just like cash. However, with a Goldmoney account, gold owners can now enjoy the same convenience, whether they’re depositing, sending or receiving transfers through an app or paying with a Goldmoney MasterCard.
“It’s not about Goldmoney being the substituted for Bitcoin,” Peter explains. “It’s gold itself. Gold is what you want to own, not Bitcoin. Goldmoney makes gold as convenient to use as Bitcoin. In fact, I think more convenient to use when it comes to commerce because you can deposit some of your gold in your Goldmoney account and now it takes all of those liquid characteristics that so many people like about Bitcoin.”
Another of Bitcoin’s favorable characteristics was its limited supply. Unlike fiat currencies, which can be printed to infinity by governments, Bitcoin has processes that keep its quantity finite. This is a desirable quality gold owners have been benefitting from for thousands of years.
However, cryptocurrencies ultimately fail the test of limited supply because there’s the potential to have an unlimited number of cryptocurrencies in existence, which is the same as money printing. So, while Bitcoin itself has a finite amount, the potential number of digital currencies is unlimited. This isn’t the case when you consider all precious metals on earth.
While gold’s price history extends over decades, we only have 8 years’ worth of Bitcoin’s ups and downs. The cryptocurrency first surpassed gold’s price in 2013, but has struggled to compete with the yellow metal. Last week, Bitcoin was trading at about $1,150, an amount close to its all-time high when it dropped 20% overnight. While Bitcoin has profited many speculators, it’s not a saver’s vehicle to wealth protection. Peter explains:
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