Bitcoin is up 48% this year, beating stocks and gold:
As banks collapse, more inflows are coming into Bitcoin (BTC) as a hedge against the crash. Therefore, Bitcoin could be considered again the "digital gold" as per its whitepaper.
Why Bitcoin is digital gold
Bitcoin is often referred to as "digital gold" because it shares some similarities with gold as a store of value, but with some key advantages that make it more suitable for the digital age. Here are some of the reasons why Bitcoin is often referred to as digital gold:
- Limited Supply: Like gold, the supply of Bitcoin is limited. There can only ever be 21 million bitcoins in existence, which means that it is a finite resource that cannot be easily manipulated or devalued.
- Scarcity: The scarcity of Bitcoin is enforced by its mining process, which becomes increasingly difficult as more Bitcoin is mined. This means that Bitcoin becomes harder and harder to obtain over time, much like gold, which becomes harder to mine as the easy-to-access deposits are depleted.
- Durability: Bitcoin, like gold, is durable and can withstand the test of time. Unlike physical gold, however, Bitcoin is not subject to corrosion, rust, or decay.
- Portability: Bitcoin is highly portable, just like gold. It can be transferred easily and quickly from one place to another, without the need for physical transportation.
- Store of Value: Both gold and Bitcoin are seen as stores of value that can be used to hedge against inflation and economic uncertainty.
- Decentralized: Bitcoin is decentralized, which means that it is not controlled by any single entity or government. This makes it more resistant to manipulation and censorship.
- Divisibility: Bitcoin can be divided into very small units, which means that it can be used for transactions of all sizes.
- Security: Bitcoin transactions are secured by advanced cryptography, making it virtually impossible to counterfeit or double-spend.
Overall, Bitcoin's similarities with gold in terms of limited supply, scarcity, durability, portability, and store of value make it a popular digital asset for investors looking to diversify their portfolios and hedge against economic uncertainty.
According to some crypto experts, most of the current inflows would go into Bitcoin (BTC) but could then flow down into top altcoins such as Ethereum (ETH) or Solana (SOL), although nothing can be guaranteed as usual.
Disclaimer: this article does not contain any financial advice. The information is provided for general informational and educational purposes only.
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