Bitcoin Is Better Than Gold: Crypto Exchange Coinbase
On May 1, the world's leading cryptocurrency exchange, Coinbase, published an article claiming Bitcoin to be superior to gold. The crypto exchange had earlier published a similar article where they supported Bitcoin over Gold due to its ease of audit, anonymity, low transaction fee, and ease to be fragmented into smaller fractions. "In the wake of the market meltdown, many investors are pouring their money into gold as a so-called “safe haven”, in the hopes that its value won't waver like fiat currency. But there isn’t enough physical gold to meet demand right now," read the Coinbase blog post.
Coinbase highlighted LA Times' article which described the current gold crisis as 'historic squeeze' and said that the news of gold bars being sent from Australia's Perth Mint to New York to fill in the shortage affirms the fact that Bitcoin's digital nature and ease of transfer at low cost makes it better than gold in terms of value storage."The recent challenges of the gold market reveals Bitcoin’s distinct advantage over gold: Bitcoin does not rely on fragile physical supply chains and is truly globally accessible," stated the Coinbase post.
Coinbase also went on to highlight the difference in the value of gold in the CME's Comex (New York) Exchange and London Gold Spot market due to hampered supply chain and gold refineries operation due to COVID-19 outbreak. The crypto exchange later pointed out that the Bitcoin algorithm is still working to generate 12.5 Units of Bitcoin in every 10 minutes, thus keeping the supply intact, unlike gold.
"Today, Bitcoin’s rate of new supply is ~3.6% per year and will soon drop to ~1.7% on May 12th, setting it on par with gold’s historic scarcity," Coinbase wrote.
The blog post also highlighted the return on the investment aspect of Bitcoin and compared it with gold. According to Coinbase, in terms of return in the year 2020, Bitcoin has outperformed gold and S&P 500 where Bitcoin has a +20% return while gold and S&P 500 have +12% and -8% returns respectively as of April 29, 2020.
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