Tyler Winklevoss, chief executive officer of Gemini and one of the famous Winklevoss twins, in a Twitter post said that bitcoin is able to match or beat gold across the board. He said that even though gold got a 3,000-year head-start, the digital token in just 10 years is catching on with it .
Bitcoin is gold 2.0. It matches or beats gold across the board. It’s market cap is ~140bil, gold’s market cap is ~7tril. Do the math!
— Tyler Winklevoss (@tylerwinklevoss) May 16, 2019
Tyler claims that bitcoin in just a few years has accumulated a total market cap of 140 billion dollars while gold in 3,000 years has just accumulated 7 trillion dollars, thus bitcoin will reach the level of gold faster than gold ever did. A report by Grayscale Investments says that unlike gold, bitcoin is scarce as there are only going to be 21 million units in existence. This scarcity makes it more valuable than gold. Bitcoin is decentralized and verifiable through the internet ledger and is unconfiscatable by authorities in any way. Gold, on the other hand, has issues with its purity all around the world. It is also available in a relatively infinite amount and is hard to verify.
Bitcoin is Gold 2.0 Debate
The idea of bitcoin replacing gold has been around for a while, but no one has thrown their support around the idea more than Grayscale Investment. Grayscale’s idea for the future revolves around a bitcoin-based financial system rather than a gold-based system. Grayscale has been a primary force in rallying around investors to drop gold and invest in bitcoin. ‘Drop Gold‘ campaign and #DropGold hashtag was started by Grayscale Investment to convince investors. Moreover, many investors and crypto influencers have hailed bitcoin as the new gold.
While answering BlockPublisher to a question whether bitcoin is the digital gold, Jorge Farias, CEO and Founder of Cryptobuyer, stated:
According to his initial conception, we believe that gold historically began to be valuable because people treasured it, then because of its decorative qualities and wealth demonstration, and nowadays even for its applications in technology and medicine. Bitcoin is seeing that same evolution and will eventually become a standard and benchmark measure.
Professor François Longin from ESSEC Business School, also talked to BlockPublisher and weighed in on the viability of bitcoin replacing gold in the future. He did not fully agree with the idea but did make some very significant points. He said:
Bitcoin can be considered as the new digital gold as it presents a low correlation during extremely volatile periods, especially stock market crashes. However, gold is still essential for portfolio risk management. Both Bitcoin and gold can be used together (in the same portfolio at the same time) to provide diversification benefit for investors.
What if Bitcoin Replaces Gold?
The current market capitalization of gold is around 7 trillion dollars. In a world where bitcoin absorbs all the value of gold and replaces gold as the standard for the financial system, the price of one bitcoin would be around $350,000. These figures are according to a Seattle based crypto investor HodI Whale who made the calculations on Twitter.
If #Bitcoin were to displace the value of gold the current value of a single Bitcoin would be $350K. Bitcoin has the ability to displace value across many financial and technology markets. $BTC is greater than #Gold #BTC350K
— HodlWhale (@HodlWhale) April 19, 2019
The figure and the math checks out. Bitcoin can be worth upwards of $350,000 if it absorbs the price of gold. However, some experts seem to think that the number is even higher than this. A Crypto Voices said that the number may be around $450,000, a number that would give crypto a market cap of over 9.5 trillion dollars, more than the seasonal food and beverages market all around the world.
Who are Winklevoss Twins?
The Winklevoss twins gained spotlight during their trial against Facebook as the twins accused Zuckerberg of stealing their idea and they won over $65 million in a settlement deal. The twins went out looking for investment opportunities with their newfound money. However, they were turned down by all Silicon Valley startups because of their feud with tech giant Facebook. Both the twins then focused on the crypto world. They invested in a company known as BitInstant that allowed people to buy bitcoin through cash. Both the twins went on a buying spree and bought a lot of bitcoin over the years.
When they went on their buying spree, bitcoin was trading at around $110. Now that the price of bitcoin has increased substantially, they are worth hundreds of millions of dollars. For a small period in 2017, the twins also became billionaires when the price of bitcoin reached its peak of $19,500. The twins allegedly hold more than 100,000 bitcoins, almost 1% of the whole mined bitcoins circulating in the world.