Cryptocurrency Compared to Gold
Cryptocurrency has several practical advantages over gold. For one, it’s a lot easier to spend than gold. If you’ve never tried spending gold, try taking your gold bar valued at $2,000 into a cafe to buy a latte and see what happens. Even making a purchase with gold coins is virtually impossible because even those are worth several hundred dollars.
Gold is not very fungible and is more useful as a store of value unless you want to trade it for a high-value item of equivalent value like a painting, antique, or something similar. However, you can have a Visa card linked to a crypto wallet and buy your latte, or anything else for that matter, without any problems.
Another practical advantage of cryptocurrency is that you can make cross-border payments more easily than with gold. Yes, you can send $1 million worth of gold to someone and get something in exchange, but you’ll have to factor in transportation costs, tariffs, and God knows what else. With crypto, you can bypass all that red tape and pay for what you want a lot faster and more efficiently.
The final advantage of cryptocurrency is that it is much easier to store than gold. A major investor who buys gold will have to pay for storage and pay for transportation when he wants to ship it. However, crypto can sit in a hot wallet (which I don’t advise doing) or in a thumb drive in a desk drawer or safe without taking up space or costing you money.
Gold has several practical advantages over cryptocurrency, though. First, gold is not nearly as volatile as cryptocurrency. If you look at a Bitcoin price chart, the value is all over the place, but the squiggly lines of a gold price chart are not, at least not as much.
Another advantage of having gold is that it is useful for conducting transactions you don’t want people to know about. For example, if you’re fleeing some war-torn and screwed up place and need to bribe your way past the border guard, gold is just as good as a passport stamped with a visa. Contrary to popular belief, cryptocurrencies are not anonymous, and there are ways to trace transactions.
The paragraph above leads us to gold’s anonymity. Unless you shoot your mouth off to everyone you know, no one will ever know you have gold (or for that matter silver or jewelry), making it great for hiding your wealth from people who have no business knowing you have it. A good example of this is the Dad’s Army episode ‘The Miser’s Hoard’ in which a neurotic Scottish undertaker converts every shilling he saves into golden guineas and jealousy protects them from his friends, colleagues, and clients. The episode, and the whole series, is a hilarious take on the British Home Guard during the Second World War. Watch, and you won’t regret it.
Gold’s best advantage is that it is physical wealth and not data, meaning you are in complete control of it. No one can hack it or electronically lock you out of your safe or desk drawer, nor can you lose the password for your gold. That advantage gives gold a slight edge over cryptocurrency.
Getting back to storing gold, it is not that much of a hassle if you buy a few bars weighing only a few grams. You won’t have to rent space at a storage facility for several hundred dollars a month. Instead, buy a safe, bolt it to the floor of your closet, and put your gold inside. It’s a good place to put your crypto hard wallet too.
Considering all of the benefits of having both, you should buy both, if you have the money to spend. For that matter, and I have said this before, you should not only buy gold and cryptocurrency. Consider buying other precious metals like silver and buying property, like a house with some land if you’re in America or an apartment if you live in Europe. Diversify your portfolio as much as you can because it is never a good idea to put all your eggs in one basket.