In a nutshell, I see Bitcoin as being digital gold.
Bitcoin has many of the same attributes as gold.
It’s separate from any fiat currency, like the dollar or the Euro.
I can hold Bitcoin outside of the banking system. I don’t need anyone’s permission to own gold or Bitcoin.
I can take Bitcoin with me, wherever I go.
And, like gold, Bitcoin is scarce.
With gold, it’s expensive to get it out of the ground.
With Bitcoin, because of the software design behind out, there can only ever be 21 million Bitcoins in existence. Right now, as I write this, there are fewer than 2.5 million coins remaining to be mined.
In other words, they’re getting really, really scarce. And, as a result, more expensive.
Bitcoin has many of the key attributes of gold. So if you love that gold gives you a secure store of value outside traditional channels, then you should probably like Bitcoin too.
For my part, I want more Bitcoin and less gold for a few reasons.
Reason #1… When the pandemic hit, I couldn’t access my safety deposit box.
One of the reasons to hold physical gold is that you want to be able to access it and use it during times of emergency.
Well, I had my gold coins stored in a safety deposit box at my local bank.
And then… when the pandemic hit, the bank’s branches all closed, and I couldn’t get to my box or my gold.
As it turned out, that wasn’t a problem. But it was a lesson learned.
Sure, I could have stored my gold at home. But that opens up a whole other level of risk that I didn’t want to take.
With Bitcoin, I can always access my money at any time, 24/7, anywhere in the world.
All I need is Internet access.
And because of the unique encryption strengths of the blockchain on which Bitcoin lives, my money is incredibly secure.
Reason#2… I can divide and spend my Bitcoin a lot more easily.
With gold I typically buy one-ounce coins. If I buy smaller coins, the fees start to bite into the value.
This means, in times of crisis, I’d be walking around with about $1,700 worth of gold in every coin.
How do I spend that? How do I divide it?
Gold is great during normal times. But, contrary to the popular narrative, not so good during times of crisis or upheaval.
Bitcoin is a lot better in that regard.
First, I don’t have to carry gold around in public. I can access my Bitcoin through my phone.
Better still, I can spend very small fractions of each Bitcoin. So I can buy groceries, gas or a drink at my favorite bar. Try doing that with a gold coin.
Reason #3… Bitcoin is becoming a lot less speculative and more certain.
A few years ago, buying Bitcoin was a leap of faith. As money, was it even “real”?
That’s changing now.
Millions of people have invested billion of dollars in Bitcoin.
Traditional banks are beginning to pay close attention.
PayPal recently announced it would accept Bitcoin on its platform. That’s a huge vote of confidence.
Even the most cautious among us can now feel more secure about buying Bitcoin.
Which is why I’m selling about half the physical gold I own to finance my next buy of Bitcoin.
Where can you buy Bitcoin?
There are various ways to buy Bitcoin. But unless you’re already an expert, your best bet is to buy through an exchange.
This allows you to buy, sell, and store your Bitcoin all in the same place.
Kraken and Coinbase are two of the largest and best established exchanges.
Create an account with Kraken…
Set up an account at Coinbase…
[OwningGold is an affiliate of both Kraken and Coinbase. This means that if you sign up for either service after following one of our links, we’ll receive a small commission.]
Further reading:
Bitcoin… It’s like gold, but digital. There’s plenty to love about it.
6 Good reasons to own gold coins or gold bars.
Storing gold – at home, in a safety deposit box, or with your dealer.