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While I’m not a fan of crypto, I don’t really understand how bitcoin is different from other commodities. Would you say gold’s value is determined mostly by it

by brap 2y ago

While I’m not a fan of crypto, I don’t really understand how bitcoin is different from other commodities. Would you say gold’s value is determined mostly by its practical use? Because it seems demand is largely driven by speculation as an alternative currency.

arccy 2y ago
an alternative currency because humans have a long history of treating it as a valuable item, mostly for jewelry / decorative purposes. crypto only copied the speculative currency part, but it's not useful even for showing off...
loeg 2y ago
I think the unsatisfying answer is that Bogle was a bit of gold bug -- he had a 5% gold allocation.
- tcbawo 2y ago
  Gold was historically uncorrelated to other asset classes, so there was a portfolio theory reason to allocate in gold. In times of uncertainty and fear, people would flee to gold. Afaik, this effect has been muted in recent years. I don’t know if it has been fully explained, but it’s likely due to the highly available and interconnected investment products of today. Bitcoin has been shown to have a high beta with credit and other investment assets. So from a portfolio theory perspective, it is functionally more like a leveraged ETF than a hedge. This doesn’t mean that neither deserves a place in a modern portfolio. As they say, past returns are no guarantee of future results.
  - wbl 2y ago
    If all you give me is leveraged beta I can replicate that more cheaply.
  - rsynnott 2y ago
    It’s arguably a _bit_ of a myth that people flee to gold in times of uncertainty. It’s something that many people believe happens, and it does seem to happen to _some_ extent, but not to the extent that people believe. Adjusted for inflation, gold has never reached its 1980s peak again, and may never do so, despite a number of greater economic and social shocks since that peak.
    - DennisP 2y ago
      So it bubbled and crashed forty years ago. In the past 25 years it's had decent returns, and in particular: 2007: 31.59%, 2008: 3.41%, 2009: 27.63%, 2010: 27.74% [1] Owning too much gold is terrible, but a modest allocation to gold in a portfolio of mostly stocks, which you rebalance every year or two, works out pretty well. [2] [1] https://www.macrotrends.net/1333/historical-gold-prices-100-year-chart https://www.macrotrends.net/1333/historical-gold-prices-100-... [2] https://portfoliocharts.com/2021/12/16/three-secret-ingredients-of-the-most-efficient-portfolios/ https://portfoliocharts.com/2021/12/16/three-secret-ingredie...
      - rsynnott 2y ago
        I mean, each to their own. I don’t understand how anyone can look at that chart, and look at, say, an S&P500 returns chart (or an MSCI World chart if you want some more diversity) and say “yes, gold is a good long-term investment”, but you do you. (NB. Gold enthusiasts will sometimes try to cloud the waters by comparing gold to, say, S&P500 price only (ie pretending dividends aren’t a thing). This honestly still doesn’t leave gold looking very attractive, but it’s also dishonest. To compare like with like you want to look at S&P500 with dividends reinvested, and at that point gold just isn’t even in the running.)
        tcbawo 2y ago
        Portfolio theory suggests holding uncorrelated assets and rebalancing. If/when the stock market has a down year, it hopefully softens the drawdown.
        DennisP 2y ago
ksd482 2y ago
Bitcoin has no intrinsic value. It is not backed by anything real. Gold has its uses. It’s a pretty metal and has practical uses in engineering and medicine. It has been a choice for jewelry for thousands of years.
- cubefox 2y ago
  > Gold has its uses. It’s a pretty metal and has practical uses in engineering and medicine. Would you say gold’s value is determined mostly by its practical use? Because it seems demand is largely driven by speculation as an alternative currency.
  - Spooky23 2y ago
    It’s practical use both increases demand and removes the commodity from the market. BTC is more volatile than gold.
- smoovb 2y ago
  Paper bills, or “fiat” money, also have no intrinsic value. Using paper money has already defined you as a participant in accepting the societal construct of money. As such, Bitcoin having no intrinsic is not novel or consequential and has no bearing on its utility.
  - rsynnott 2y ago
    Well, I mean (a) it is unwise to accumulate a big pile of paper money (or the equivalent in a bank), like a common Disney duck plutocrat; if you do this, you will in the long run lose money in real terms. By design. Money (or at least modern money; things were somewhat different in persistently-deflationary pre-industrial economies) is not designed for investment. Money should not be the comparison; it’s a tool, not an investment vehicle. But (b) money is given some real grounding by states; you can pay tax with it, in particular. It’s not much, and it’s not bulletproof, but by comparison to cryptocurrency, well, it’s _something_. But really, it makes no sense as an argument that hoarding cryptocurrency is a good idea, because hoarding _money_ is, notoriously, a _bad_ idea.
jazzyjackson 2y ago
>> Commodities are real assets that meet consumption needs Granted a commodity's value may be driven by speculation, but at the end of the day it's a material that is consumed by various industries.
tcbawo 2y ago
Besides practical use, gold also has aesthetic use: jewelry, as an external status symbol of wealth. That is not possible for crypto currencies in the same way. Of course as online presence and social structures mature, this might change. Maybe not in my generation’s lifetime, but who knows.
- __turbobrew__ 2y ago
  Im hate crypto as much as the next person, but is jewelry as a status symbol that different from an NFT as a status symbol or having a bitcoin wallet worth $1mil as a status symbol? People in CS:GO pay (tens) of thousands of dollars for skins which are just digital status symbols. Maybe the property of gold is that it is a status symbol which has a long history and cannot be duped.
  - davidw 2y ago
    I'm not into gold or crypto but gold jewelry has a tiny bit more of a track record than nfts
  - deleted 2y ago
    [deleted]
  - tcbawo 2y ago
    In general, yes. Jewelry can be melted down and repurposed. It’s also visible in the physical world, which means more to many people today (maybe not to future generations). In that way, I think NFTs are more comparable to, say collectible mechanical watches, baseball cards, stamps, art. It might be worth dollar for dollar to some people, but the market for gold is much larger.
  - thelastgallon 2y ago
    Is a picture of gold jewelry (NFT) worth the same as jewelry?
rainsford 2y ago
I honestly don't know how much of gold's value is driven by practical uses rather than speculation, but I think there's an important difference between "some practical use" and "no practical use" when it comes to commodities. The practical uses mean gold is unlikely to ever be worthless, but the same can't be said for a cryptocurrency. Even from a speculative standpoint, gold or similar commodities have the advantage of being actually support limited. Now obviously the supply of an individual cryptocurrency can be limited, such as with Bitcoin, but the supply of cryptocurrency in general is essentially unlimited with very little barrier to entry. That's not great for even speculative investment, since you're essentially betting on the continued popularity of whatever currency you invested in with relatively little history to support that trend.
- njarboe 2y ago
  Does it really matter if the value of something is 95% speculative or 100%? Loosing 95% of the value of your investment is not a lot different than 100%.
  - NAHWheatCracker 2y ago
    Bitcoin is certainly extremely high on the speculative spectrum, but claiming gold is anywhere near the same level of speculation is specious. Gold has the Lindy effect going for it. Humans have been trading it for thousands of years. Bitcoin has been around for 16 years. Gold has industrial uses and if its value dropped, its uses would expand. Bitcoin has no such inherent supply-demand curve.
    - njarboe 2y ago
      I like gold and bitcoin. But productive assets seem more useful to hold in general. Fiat, gold, and bitcoin are debt tokens on future humans. I'd rather own things than future human labor. Feels a bit like owning people.
selectodude 2y ago
Gold has a commodity value above zero. It’s used industrially. Even if everybody decides it’s not worth its precious metal value, it’s not worthless. Bitcoin has zero intrinsic value. None.
- cubefox 2y ago
  That's a stupid argument. When someone finds some niche applications of crypto currencies in payment services, or something like that, it's economic value is above zero. But what matters is how close the economic value is to the market value, not whether the economic value is literally zero or not.
  - rsync 2y ago
    The difference is that I can create an infinite number of different block chains and or crypto coins. I can restart forks of both bitcoin and Ethereum on my laptop at this moment. I can restart 10 forks each. Or 100. I cannot do that with gold.
    - cubefox 2y ago
      That's irrelevant. You can choose to speculate with literally anything, not just newly invented crypto currencies or gold. Historically people have speculated with tulips and countless other things. The problem is the missing economic value, not whether you can create similar things. It's irrelevant for the economic value of gold whether new elements can be created or not.
    - r33b33 2y ago
      > The difference is that I can create an infinite number of different block chains and or crypto coins. Yes, but Russian Federation uses only one to evade sanctions.
    - est31 2y ago
      Sure you can create 10 different blockchains but will those have "stable" value 10 years from now? In China, it's nearly impossible to invest your assets without friends in the government. The government strictly controls conversion of their currency to non-Chinese currencies. As strange as this sounds, but with cryptocurrencies, you can export value from your country to something more stable. Same goes for many south american countries. I still wouldn't invest into Bitcoin or Ethereum but I live in the west where there is the rule of law and one can invest into a large variety of asset classes.
EliRivers 2y ago
Other commodities have a physical existence. That's quite a big difference.
- bryankaplan 2y ago
  Certainly true. Gold is difficult to transport and expensive to protect, whereas Bitcoin is neither.
  - EliRivers 2y ago
    Indeed. Other commodities have other strengths; oil can be turned into a huge range of products that make people's lives better, wheat can be literally used to make food to radically enhance people's lived experience, aluminium is a key component in an enormous range of goods covering almost every aspect of life. If what Bitcoin can offer isn't having any actual application that improves anyone's life but is easy to move around, well, gotta go with your only strength, I guess.
carlosjobim 2y ago
Gold is the single best thing that exists in the world and that has ever existed. That's where the value is.
- DonHopkins 2y ago
  You seem to have Gold confused with Tacos.
mrtksn 2y ago
You can't eat or burn bitcoin, therefore doesn't need to be balanced or made sustainable through economical instruments. You know all those economical instruments? They actually serve a purpose(like making the price stable or making the supply and demand predictable. This is important because it usually takes months to years to produce these things and you don't want to destroy your producers or production capacity for a glitch) and they're not just a gambling machine with strength rules.
- linsomniac 2y ago
  >[economical instruments are] not just a gambling machine Oh really? With stock buybacks, splits, and options, financial trickery, and market cap not matching production? There are lots of forces in the market that make it very much a gambling machine. For example SMCI produces very real things, I've owned hundreds of their products, but some questionable decisions resulted in a huge drop despite them being well positioned for all the AI growth. Or TSLA, which has recently doubled from a point where many felt the stock price didn't match the available market.
  - mrtksn 2y ago
    The point is that their reason for existence isn't gambling. It wouldn't be surprising if more rules and restrictions are introduced if they end up not being able to serve their core purpose.
    - linsomniac 2y ago
      Don't take this the wrong way, but the way you say "their core purpose" makes me think that you agree that their reason for existence isn't gambling. I'd agree that they haven't lived up to their core purpose as much as they could have, and it's a lot gambling
      - mrtksn 2y ago
        Not functioning as intended is different than the original intentions and it is important when arguing for one more function.
RandomLensman 2y ago
Taking an investment position in a commodity vs a speculative position indeed could raise some non-trivial questions (if you believe in/subscribe to some sort dichotomy there). I seem to remember in the past, commodity investments where viewed with an eye towards diversification benefits, for example.
vishnugupta 2y ago
In India gold demand is driven by its use as jewelry. It is also used as a safe asset that can either be pledged or sold in time of need. This has been the case for hundreds of years if not more.
Demlmlm 2y ago
Gold is also no longer a good thing but still better than crypto. In an apocalypse gold s still usable and gold has other uses. Like industrial and as jewelry
cyberax 2y ago
Gold looks nice, golden jewelry can be beautiful. This is not going to ever change. Even if it does, gold's ductility and chemical resistance will still be important for industrial applications. And the scarcity of gold is not likely to decrease in the near future, unlike with diamonds that can now be cheaply manufactured and bought on AliExpress.
keymon-o 2y ago
This will not be an argument but my perspective as an amateur investor. Main difference between gold and bitcoin is in its history. Gold as a type of investment instrument has already earned its reputation and status. It’s not just a commodity, it’s a financial instrument that had its use in building and making of history and it’s well integrated, recognized and supported by most government and societies. We still don’t know what Bitcoin really is and how it behaves. It could be valued 10k times up or down next year and there could be no clear reason why that happened. Bitcoin is not in hands of most powerful companies, people and governments and change of its value would not affect anything but net worth of certain individuals or organizations. By no means, I think bitcoin is here to stay and it has a very clear future as an investment and payment instrument. But I think it’s really silly to say Bitcoin is speculative as much as other investment instruments.
- beau_g 2y ago
  >We still don’t know what Bitcoin really is and how it behaves We know both of those things 100%, it's in the source code and ledger of every transaction that has ever occurred from it's inception. We certainly do NOT know that in regards to gold, nobody has a good picture of the world's total gold reserves and where they are, the extraction rate, or it's exchange. A lot of what people say is true of bitcoin but not of gold seems to be precisely the opposite. As far as what should bitcoin's utility be valued at to the world at large, sure this is in a volatile state, but I don't see how that bears on it's classification as an asset.
icegreentea2 2y ago
Gold is also not like other commodities. No one treats gold the way you treat iron or lithium or even platinum/palladium. And for what it's worth, Vanguard doesn't have a pure gold ETF.
stouset 2y ago
Gold is also a generally terrible asset to hold as a long-term store of value.
- anonfordays 2y ago
  Not true: https://moneyandmarkets.com/gold-vs-stocks/ https://moneyandmarkets.com/gold-vs-stocks/
tim333 2y ago
Gold's fundamentals are it is mined and used for jewellery. Speculation and hoarding can cause it to fluctuate a fair bit but long term the price is driven by the mining cost. See the 200 year inflation adjusted price https://www.marottaonmoney.com/wp-content/uploads/2013/05/stocks-for-the-long-run.png https://www.marottaonmoney.com/wp-content/uploads/2013/05/st... It's remarkably constant in the long run. Bitcoin is different. Although it's mined, the mining difficulty constantly adjusts to keep the block time at 10 minutes. The price is set by the people in the market buying and selling it and so fluctuates all over the place.

by brap 2y ago

arccy 2y ago

an alternative currency because humans have a long history of treating it as a valuable item, mostly for jewelry / decorative purposes. crypto only copied the speculative currency part, but it's not useful even for showing off...

loeg 2y ago

I think the unsatisfying answer is that Bogle was a bit of gold bug -- he had a 5% gold allocation.

tcbawo 2y ago
Gold was historically uncorrelated to other asset classes, so there was a portfolio theory reason to allocate in gold. In times of uncertainty and fear, people would flee to gold. Afaik, this effect has been muted in recent years. I don’t know if it has been fully explained, but it’s likely due to the highly available and interconnected investment products of today. Bitcoin has been shown to have a high beta with credit and other investment assets. So from a portfolio theory perspective, it is functionally more like a leveraged ETF than a hedge. This doesn’t mean that neither deserves a place in a modern portfolio. As they say, past returns are no guarantee of future results.
- wbl 2y ago
  If all you give me is leveraged beta I can replicate that more cheaply.
- rsynnott 2y ago
  It’s arguably a _bit_ of a myth that people flee to gold in times of uncertainty. It’s something that many people believe happens, and it does seem to happen to _some_ extent, but not to the extent that people believe. Adjusted for inflation, gold has never reached its 1980s peak again, and may never do so, despite a number of greater economic and social shocks since that peak.
  - DennisP 2y ago
    So it bubbled and crashed forty years ago. In the past 25 years it's had decent returns, and in particular: 2007: 31.59%, 2008: 3.41%, 2009: 27.63%, 2010: 27.74% [1] Owning too much gold is terrible, but a modest allocation to gold in a portfolio of mostly stocks, which you rebalance every year or two, works out pretty well. [2] [1] https://www.macrotrends.net/1333/historical-gold-prices-100-year-chart https://www.macrotrends.net/1333/historical-gold-prices-100-... [2] https://portfoliocharts.com/2021/12/16/three-secret-ingredients-of-the-most-efficient-portfolios/ https://portfoliocharts.com/2021/12/16/three-secret-ingredie...
    - rsynnott 2y ago
      I mean, each to their own. I don’t understand how anyone can look at that chart, and look at, say, an S&P500 returns chart (or an MSCI World chart if you want some more diversity) and say “yes, gold is a good long-term investment”, but you do you. (NB. Gold enthusiasts will sometimes try to cloud the waters by comparing gold to, say, S&P500 price only (ie pretending dividends aren’t a thing). This honestly still doesn’t leave gold looking very attractive, but it’s also dishonest. To compare like with like you want to look at S&P500 with dividends reinvested, and at that point gold just isn’t even in the running.)
      - tcbawo 2y ago
        Portfolio theory suggests holding uncorrelated assets and rebalancing. If/when the stock market has a down year, it hopefully softens the drawdown.
      - DennisP 2y ago

ksd482 2y ago

Bitcoin has no intrinsic value. It is not backed by anything real. Gold has its uses. It’s a pretty metal and has practical uses in engineering and medicine. It has been a choice for jewelry for thousands of years.

cubefox 2y ago
> Gold has its uses. It’s a pretty metal and has practical uses in engineering and medicine. Would you say gold’s value is determined mostly by its practical use? Because it seems demand is largely driven by speculation as an alternative currency.
- Spooky23 2y ago
  It’s practical use both increases demand and removes the commodity from the market. BTC is more volatile than gold.
smoovb 2y ago
Paper bills, or “fiat” money, also have no intrinsic value. Using paper money has already defined you as a participant in accepting the societal construct of money. As such, Bitcoin having no intrinsic is not novel or consequential and has no bearing on its utility.
- rsynnott 2y ago
  Well, I mean (a) it is unwise to accumulate a big pile of paper money (or the equivalent in a bank), like a common Disney duck plutocrat; if you do this, you will in the long run lose money in real terms. By design. Money (or at least modern money; things were somewhat different in persistently-deflationary pre-industrial economies) is not designed for investment. Money should not be the comparison; it’s a tool, not an investment vehicle. But (b) money is given some real grounding by states; you can pay tax with it, in particular. It’s not much, and it’s not bulletproof, but by comparison to cryptocurrency, well, it’s _something_. But really, it makes no sense as an argument that hoarding cryptocurrency is a good idea, because hoarding _money_ is, notoriously, a _bad_ idea.

jazzyjackson 2y ago

>> Commodities are real assets that meet consumption needs Granted a commodity's value may be driven by speculation, but at the end of the day it's a material that is consumed by various industries.

tcbawo 2y ago

Besides practical use, gold also has aesthetic use: jewelry, as an external status symbol of wealth. That is not possible for crypto currencies in the same way. Of course as online presence and social structures mature, this might change. Maybe not in my generation’s lifetime, but who knows.

__turbobrew__ 2y ago
Im hate crypto as much as the next person, but is jewelry as a status symbol that different from an NFT as a status symbol or having a bitcoin wallet worth $1mil as a status symbol? People in CS:GO pay (tens) of thousands of dollars for skins which are just digital status symbols. Maybe the property of gold is that it is a status symbol which has a long history and cannot be duped.
- davidw 2y ago
  I'm not into gold or crypto but gold jewelry has a tiny bit more of a track record than nfts
- deleted 2y ago
  [deleted]
- tcbawo 2y ago
  In general, yes. Jewelry can be melted down and repurposed. It’s also visible in the physical world, which means more to many people today (maybe not to future generations). In that way, I think NFTs are more comparable to, say collectible mechanical watches, baseball cards, stamps, art. It might be worth dollar for dollar to some people, but the market for gold is much larger.
- thelastgallon 2y ago
  Is a picture of gold jewelry (NFT) worth the same as jewelry?

rainsford 2y ago

I honestly don't know how much of gold's value is driven by practical uses rather than speculation, but I think there's an important difference between "some practical use" and "no practical use" when it comes to commodities. The practical uses mean gold is unlikely to ever be worthless, but the same can't be said for a cryptocurrency. Even from a speculative standpoint, gold or similar commodities have the advantage of being actually support limited. Now obviously the supply of an individual cryptocurrency can be limited, such as with Bitcoin, but the supply of cryptocurrency in general is essentially unlimited with very little barrier to entry. That's not great for even speculative investment, since you're essentially betting on the continued popularity of whatever currency you invested in with relatively little history to support that trend.

njarboe 2y ago
Does it really matter if the value of something is 95% speculative or 100%? Loosing 95% of the value of your investment is not a lot different than 100%.
- NAHWheatCracker 2y ago
  Bitcoin is certainly extremely high on the speculative spectrum, but claiming gold is anywhere near the same level of speculation is specious. Gold has the Lindy effect going for it. Humans have been trading it for thousands of years. Bitcoin has been around for 16 years. Gold has industrial uses and if its value dropped, its uses would expand. Bitcoin has no such inherent supply-demand curve.
  - njarboe 2y ago
    I like gold and bitcoin. But productive assets seem more useful to hold in general. Fiat, gold, and bitcoin are debt tokens on future humans. I'd rather own things than future human labor. Feels a bit like owning people.

selectodude 2y ago

Gold has a commodity value above zero. It’s used industrially. Even if everybody decides it’s not worth its precious metal value, it’s not worthless. Bitcoin has zero intrinsic value. None.

cubefox 2y ago
That's a stupid argument. When someone finds some niche applications of crypto currencies in payment services, or something like that, it's economic value is above zero. But what matters is how close the economic value is to the market value, not whether the economic value is literally zero or not.
- rsync 2y ago
  The difference is that I can create an infinite number of different block chains and or crypto coins. I can restart forks of both bitcoin and Ethereum on my laptop at this moment. I can restart 10 forks each. Or 100. I cannot do that with gold.
  - cubefox 2y ago
    That's irrelevant. You can choose to speculate with literally anything, not just newly invented crypto currencies or gold. Historically people have speculated with tulips and countless other things. The problem is the missing economic value, not whether you can create similar things. It's irrelevant for the economic value of gold whether new elements can be created or not.
  - r33b33 2y ago
    > The difference is that I can create an infinite number of different block chains and or crypto coins. Yes, but Russian Federation uses only one to evade sanctions.
  - est31 2y ago
    Sure you can create 10 different blockchains but will those have "stable" value 10 years from now? In China, it's nearly impossible to invest your assets without friends in the government. The government strictly controls conversion of their currency to non-Chinese currencies. As strange as this sounds, but with cryptocurrencies, you can export value from your country to something more stable. Same goes for many south american countries. I still wouldn't invest into Bitcoin or Ethereum but I live in the west where there is the rule of law and one can invest into a large variety of asset classes.

EliRivers 2y ago

Other commodities have a physical existence. That's quite a big difference.

bryankaplan 2y ago
Certainly true. Gold is difficult to transport and expensive to protect, whereas Bitcoin is neither.
- EliRivers 2y ago
  Indeed. Other commodities have other strengths; oil can be turned into a huge range of products that make people's lives better, wheat can be literally used to make food to radically enhance people's lived experience, aluminium is a key component in an enormous range of goods covering almost every aspect of life. If what Bitcoin can offer isn't having any actual application that improves anyone's life but is easy to move around, well, gotta go with your only strength, I guess.

carlosjobim 2y ago

Gold is the single best thing that exists in the world and that has ever existed. That's where the value is.

DonHopkins 2y ago
You seem to have Gold confused with Tacos.

mrtksn 2y ago

You can't eat or burn bitcoin, therefore doesn't need to be balanced or made sustainable through economical instruments. You know all those economical instruments? They actually serve a purpose(like making the price stable or making the supply and demand predictable. This is important because it usually takes months to years to produce these things and you don't want to destroy your producers or production capacity for a glitch) and they're not just a gambling machine with strength rules.

linsomniac 2y ago
>[economical instruments are] not just a gambling machine Oh really? With stock buybacks, splits, and options, financial trickery, and market cap not matching production? There are lots of forces in the market that make it very much a gambling machine. For example SMCI produces very real things, I've owned hundreds of their products, but some questionable decisions resulted in a huge drop despite them being well positioned for all the AI growth. Or TSLA, which has recently doubled from a point where many felt the stock price didn't match the available market.
- mrtksn 2y ago
  The point is that their reason for existence isn't gambling. It wouldn't be surprising if more rules and restrictions are introduced if they end up not being able to serve their core purpose.
  - linsomniac 2y ago
    Don't take this the wrong way, but the way you say "their core purpose" makes me think that you agree that their reason for existence isn't gambling. I'd agree that they haven't lived up to their core purpose as much as they could have, and it's a lot gambling
    - mrtksn 2y ago
      Not functioning as intended is different than the original intentions and it is important when arguing for one more function.

RandomLensman 2y ago

Taking an investment position in a commodity vs a speculative position indeed could raise some non-trivial questions (if you believe in/subscribe to some sort dichotomy there). I seem to remember in the past, commodity investments where viewed with an eye towards diversification benefits, for example.

vishnugupta 2y ago

In India gold demand is driven by its use as jewelry. It is also used as a safe asset that can either be pledged or sold in time of need. This has been the case for hundreds of years if not more.

Demlmlm 2y ago

Gold is also no longer a good thing but still better than crypto. In an apocalypse gold s still usable and gold has other uses. Like industrial and as jewelry

cyberax 2y ago

Gold looks nice, golden jewelry can be beautiful. This is not going to ever change. Even if it does, gold's ductility and chemical resistance will still be important for industrial applications. And the scarcity of gold is not likely to decrease in the near future, unlike with diamonds that can now be cheaply manufactured and bought on AliExpress.

keymon-o 2y ago

This will not be an argument but my perspective as an amateur investor. Main difference between gold and bitcoin is in its history. Gold as a type of investment instrument has already earned its reputation and status. It’s not just a commodity, it’s a financial instrument that had its use in building and making of history and it’s well integrated, recognized and supported by most government and societies. We still don’t know what Bitcoin really is and how it behaves. It could be valued 10k times up or down next year and there could be no clear reason why that happened. Bitcoin is not in hands of most powerful companies, people and governments and change of its value would not affect anything but net worth of certain individuals or organizations. By no means, I think bitcoin is here to stay and it has a very clear future as an investment and payment instrument. But I think it’s really silly to say Bitcoin is speculative as much as other investment instruments.

beau_g 2y ago
>We still don’t know what Bitcoin really is and how it behaves We know both of those things 100%, it's in the source code and ledger of every transaction that has ever occurred from it's inception. We certainly do NOT know that in regards to gold, nobody has a good picture of the world's total gold reserves and where they are, the extraction rate, or it's exchange. A lot of what people say is true of bitcoin but not of gold seems to be precisely the opposite. As far as what should bitcoin's utility be valued at to the world at large, sure this is in a volatile state, but I don't see how that bears on it's classification as an asset.

icegreentea2 2y ago

Gold is also not like other commodities. No one treats gold the way you treat iron or lithium or even platinum/palladium. And for what it's worth, Vanguard doesn't have a pure gold ETF.

stouset 2y ago

Gold is also a generally terrible asset to hold as a long-term store of value.

anonfordays 2y ago
Not true: https://moneyandmarkets.com/gold-vs-stocks/ https://moneyandmarkets.com/gold-vs-stocks/

tim333 2y ago

Gold's fundamentals are it is mined and used for jewellery. Speculation and hoarding can cause it to fluctuate a fair bit but long term the price is driven by the mining cost. See the 200 year inflation adjusted price https://www.marottaonmoney.com/wp-content/uploads/2013/05/stocks-for-the-long-run.png https://www.marottaonmoney.com/wp-content/uploads/2013/05/st... It's remarkably constant in the long run. Bitcoin is different. Although it's mined, the mining difficulty constantly adjusts to keep the block time at 10 minutes. The price is set by the people in the market buying and selling it and so fluctuates all over the place.