Is Bitcoin meant to be a store of value or a way to buy stuff? Or maybe it can be both? Personally, I've always viewed Bitcoin as more like digital gold. It has the perks of gold without the downsides.
But with all the ups and downs in Bitcoin's price, I can't really see it working well as a currency. I'd love to hear some thoughts on why it could be better as a digital cash alternative.
Hey bro when your gold holdings become digits in your account, your gold becomes digital and no longer physical.
Bitcoin was created as an alternative currency for cross-border transactions, so it is money that exists in cyberspace, so try to re-read the bitcoin whitepaper, if I don't forget there is a sentence Bitcoin is peer to peer electronic cash system so basically Bitcoin is money, no need to twist it into gold and other commodities.
It makes more sense if someone doesn't always compare bitcoin to gold, or say that bitcoin is digital gold.
You are relatively new on the forum from your registration date going back weeks ago but, not entirely new to the cryptocurrency industry surely or perhaps youve being here all along.
We have had far too many thread that brings Bitcoin and Gold into contrast just like youve started yet another thread for. The thread youve started could have being more suited for a comment on one of those threads rather than open yet another one and invite users to spam.
A quick search on those key words Bitcoin as digital gold and you reduce the days to 150days or less would bring you current results of where you can have that discussion. This is what I could find with the search function for the themes of your thread:
Bitcoin is better than digital gold
Is Bitcoin really digital gold or is more than that?
Bitcoin a tech trade for now, not digital gold, says Grayscale
All these can accommodate whatever you need to know here and you can get update on what has being discussed if its of importance to you. Avoid creating these kind of threads without having used the search function first and if you arent bringing anything new.
Bitcoin fits in however you want to describe it based on the need you have for it; it's called "digital gold," but it has an edge over gold in terms of maximum supply and increase in scarcity. You can use it as an asset or as a store of value. How you look at it will determine how you value and cherish it, not just based on monetary value.
To be digital does not mean the thing won't have to be volatile; even fiat is volatile, talk more of cryptocurrency since the value is determined based on demand and by the people. You don't expect it to be stable without moving back and forth.
Bitcoin is both a digital gold and a digital currency. Bitcoin and gold are complementary assets, they can both function together, having gold as the physical gold while bitcoin is the digital gold since it can only be accessible online, has a store of value, and a hedge against inflation like gold itself.
Bitcoin can also perform as a digital currency across borders. It was created to act like a currency to gain financial freedom to get rid of the shadows of bank and government. But since global adoption is still in process, bitcoin at the moment is most likely used as a store of value online.
Currently, due to its price, Bitcoin is seen more as a store of value similar to gold. However, it was initially created to be used as another currency, albeit a decentralized one, so it can be both; technically, nothing prevents it from doing so. This contrasts with gold, which, being physical and expensive, is impossible to use for transactional purposes on its own.
What can be compared in both cases is that both gold and Bitcoin would be the reserve component, while traditional currencies and the Lightning Network would be the layers of use for that reserve.
Bitcoin was originally created to act as a medium of exchange, as a decentralized currency that can act as an alternative currency to fiat. But knowing it would take a lot of process and it may take years before it will be realized, people prefer to use bitcoin for now as a good store of value, as a digital gold where its value appreciates in the long run.
Simply put, bitcoin has multiple functions, as a digital currency and a tool for investment. But because its highly volatile, its effectiveness as a currency can be limited, but being a volatile asset is also an advantage when it is used as an investment.
Bitcoin can function as both a store of value and as money. Volatility may affect pricing of goods and services at a particular time, yet it doesn't stop it from being used as a medium of payment when both the parties involved in the transaction reach an agreed terms. Volatility shouldn't be treated as a weakness, it is a feature of Bitcoin which can also be advantageous. Bitcoin is divisible and a borderless currency, this should be a better reason to see Bitcoin as a good alternative currency.
If you also see Bitcoin as digital gold, it would be logical, because as the value of gold increases, the value of Bitcoin also increases in the same way. Bitcoin was created as a decentralized currency. So that your money stays with you, and you don't have to take the help of any bank to save your money. Bitcoin can be easily transacted in any country in the world, it not only helps you to make a profit from your investment. It also helps a lot, such as preventing inflation.
It is logical to call Bitcoin digital gold because people invest in gold to make a profit in the future, in the same way, people invest in Bitcoin in the hope of making a profit and increasing their accumulated wealth. Anyone can easily transact with Bitcoin if they want, and anyone can also make long-term investments. Other portfolios can also be increased through long-term investments from Bitcoin.
Unfortunately, for a currency to serve as a reliable medium of exchange across the population it has to have stability and be stable in its value. The vast majority of people will not be interested in having a "feature" on their currency that can cause them to lose up to 10% of their purchasing power between the moment they purchase a loaf of bread and when they complete the transaction.
It is both but it has been praised as a store of value rather than as a medium of exchange. Also, the whole "digital gold" thing really does not appeal to me because gold is not worth as much as BTC. It is more like digital osmium, rhodium or iridium. Since those are all metals that are worth more than gold. It seems more of a historical aspect that is being tossed around rather than an actual comparison.
Gold cannot replace Bitcoin as Bitcoin cannot replace gold. But I would rather have BTC.
Just think of an asset that appreciate like gold and with capability to transfer it freely with little fee to anyone around the world.
You get best of both world, medium of exchange and store of value. I don't think there is anything better than bitcoin in this world right now.
This is the reason why bitcoin will exist even centuries to come, it's so versatile it works very well as an investment and it works just as well to pay something over internet.
You'd realize how good we have it once you know that big payment companies could easily debank you and put you out of business on a whim.
It is both. I'm sure you already know that.
You know that and that is also correct.
You're apparently not confused. You can convert yours to a stablecoin if volatility is your concern.
You can discuss bitcoin whichever way you want to describe bitcoin, and I think that bitcoin actually means different things entirely, you can describe it as a digital currency, which personally I see bitcoin as a digital currency you can send and receive bitcoin as money, and people are doing business with bitcoin which is well appreciated by so many people.
However there are also people who sees bitcoin as a digital gold because you can invest in bitcoin, and hold for a long term, and you might end up having a good reasonable amount of profit when you invest in bitcoin which I absolutely think that is not a wrong thing to do entirely, but buying and holding bitcoin for a longer time interval.
Bitcoin is digital currency. Bitcoin is better then god. So don't lose the bitcoin. It good investment for the future save and bitcoin will be increase the price day by day. Bitcoin never will be end. Gold is good investment but it will be gold price slowly increase the price and next easy use any where. Bitcoin essy to use any where and any time. So bitcoin is digital currency.
It can be used for both purposes, even more that you can find in this book.
The bullish case for Bitcoin.
It's possibly used as a digital currency because the requirement is a private deal between two engaged parties of a business deal: buyers and sellers so that if they agree with each other about the Bitcoin exchange rate, they can finalize the business deal through Bitcoin. The volatility of Bitcoin price is not kind of barrier for a deal between them, as they only need to agree with each other to finish a trade.
Bitcoin is a digital currency system. Bitcoin offers users convenience and freedom by eliminating the need for third parties in transactions. It serves as a medium of exchange.
Bitcoin has long been used as an investment asset due to its price appreciation over time up to the present. 1 Bitcoin = 1 BTC. With a limited supply, Bitcoin is a worthy hedge. When referred to as digital gold, the implication is positive and points toward its role as a hedge.
Bitcoin can fit in such description or it can wear the clothes of both description. You can invest it and expect increase value in the future which makes it store of value and hedging against inflation. It can also be used as P2P exchange which is its primary purpose.
You are quite new with bitcoin with your allusion. Yes bitcoin made more sense with its open source through Blockchain and security guarantees, investment potential, fixed supply and scarcity.
However, I will tell you one defects of bitcoin that is comparable with gold, they are both volatile unlike fiat which is relatively controlled.
It does makes sense. The bitcoin volatility is as a result of it decentralised potential and lack of government control which is devoid of third party monitoring. So you can do whatever amount of P2P to the exclusion of other's knowledge. Bitcoin transaction cuts across borders without direct P2P regulation unlike fiat. It scarcity and limited supply makes it volatile and it is created for electronic P2P transaction without regulation originally.
I think it's currency because most of the time it's actually not that volatile. I mean, if Bitcoin was going up and down more than 10% during one day, it would be pretty hard to use it as currency, but if it's less than 5%, which is almost always the case, why not to use it? But we all know that it can be used as a store of value too, of course.
There are crash times when Bitcoin price can fall like 10% or bigger within several minutes but such crash times are not too often. In other times, more normal times, Bitcoin price usually does not have such big price change and it's possible for using bitcoin as a currency for a trade between two companies, two people. Like if they use fee rate at tip of Bitcoin mempools, the transaction can be confirmed around 10 minutes within that time, it's less likely that Bitcoin price would have a big crash.
As said, if they are concerning about price changes too much in meantime of a confirmation, they can reduce risk by using high fee rate for getting a quick confirmation in a next Bitcoin block rather than using low fee rate and wait hours for a confirmation.