Bitcoin and gold could hardly seem more unlike at first look. Over thousands of years, gold, a natural resource, has gained a reputation as a safe refuge and a store of value. In recent years, it has even become more popular as a central bank reserve, In contrast, Bitcoin is a digital asset that was created during a time when people’s faith in traditional financial institutions was at an all-time low, following the global financial crisis.
Bitcoin’s value proposition comes from innovation, but gold’s legitimacy has a long history. Its goal is to become a reliable medium of exchange, and here is where its resemblance to gold starts to show.
It is mined, has a limited quantity, and is not issued by a central government, just like gold. However, it is a more complicated addition to conventional investing portfolios due to its very brief and erratic history.
The robust performance of Bitcoin and gold in the previous year has sparked a fresh discussion over whether is a superior hedge. Gold increased by around 25%. Bitcoin more than doubled, surpassing $100,000 and continuing to do so at this time.
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