4 ms·

...all the wealth stored in cash, gold, silver, bonds and other low-risk less liquid assets will go into Bitcoin This is rather utopic vision. None of the gold

by endriju 13y ago

...all the wealth stored in cash, gold, silver, bonds and other low-risk less liquid assets will go into Bitcoin This is rather utopic vision. None of the gold owners would sell significant part of their gold for btc - gold is used to store value for ages, bitcoin is a currency.

oleganza 13y ago
I personally know a gold owner who dumped all his gold (accumulated over past several years) for Bitcoin in February. Bitcoin has different risks than gold, but you can 1) move it cheaply and quickly to a safer location any time 2) you can buy stuff with it directly. Gold sits there and you always have to fear that government or someone else confiscates it, to makes it PITA to sell a portion of it.
dredmorbius 13y ago
Both are commodities and containers for wealth. If there's an arbitrage opportunity in exchanging one for the other, they'll likely be exchanged. The thing about "store of value" principles is that the ascribed value of things changes. It generally has a floor of the marginal cost of production / extraction / acquisition, though sometimes it can fall below even that (viz: inflated currency literally not worth the paper it's printed on). If someone's willing to pay more for bitcoin than gold, or you're betting that that the value of bitcoin will increase, trading gold for BTC makes sense. In terms of tangible value -- Gold is more likely a persistent store of value than BTC, but where you need to move wealth quickly and easily (say, you're fleeing an unstable situation), a BTC wallet somewhere else might be a lot easier than smuggling out gold ingots. Even a (moderately) modest amount of wealth, say, $50m, would be somewhat over a ton of gold. Hard to run with that in your pockets. If you want to limit yourself to a maximum of 45# of weight, you could carry slighltly under $850,000 at current market prices. Not insignificant, but depending on the loot you're trying to, well, loot, possibly less than you might hope.
mike_esspe 13y ago
Silver was demonetised in 20th century relative to gold, though it was used as a store of value. It can happen with gold too. http://www.dailyreckoning.com.au/silver-a-brief-history-of-de-monetisation/ http://www.dailyreckoning.com.au/silver-a-brief-history-of-d...

by endriju 13y ago

oleganza 13y ago

I personally know a gold owner who dumped all his gold (accumulated over past several years) for Bitcoin in February. Bitcoin has different risks than gold, but you can 1) move it cheaply and quickly to a safer location any time 2) you can buy stuff with it directly. Gold sits there and you always have to fear that government or someone else confiscates it, to makes it PITA to sell a portion of it.

dredmorbius 13y ago

Both are commodities and containers for wealth. If there's an arbitrage opportunity in exchanging one for the other, they'll likely be exchanged. The thing about "store of value" principles is that the ascribed value of things changes. It generally has a floor of the marginal cost of production / extraction / acquisition, though sometimes it can fall below even that (viz: inflated currency literally not worth the paper it's printed on). If someone's willing to pay more for bitcoin than gold, or you're betting that that the value of bitcoin will increase, trading gold for BTC makes sense. In terms of tangible value -- Gold is more likely a persistent store of value than BTC, but where you need to move wealth quickly and easily (say, you're fleeing an unstable situation), a BTC wallet somewhere else might be a lot easier than smuggling out gold ingots. Even a (moderately) modest amount of wealth, say, $50m, would be somewhat over a ton of gold. Hard to run with that in your pockets. If you want to limit yourself to a maximum of 45# of weight, you could carry slighltly under $850,000 at current market prices. Not insignificant, but depending on the loot you're trying to, well, loot, possibly less than you might hope.

mike_esspe 13y ago

Silver was demonetised in 20th century relative to gold, though it was used as a store of value. It can happen with gold too. http://www.dailyreckoning.com.au/silver-a-brief-history-of-de-monetisation/ http://www.dailyreckoning.com.au/silver-a-brief-history-of-d...