Gold Investing Precious Metals Investment VS Cryptocurrency
What Is The Difference Between Gold Investing Precious Metals Investment VS Cryptocurrency? And Why Choose gold investing in the year 2018?
Investment cryptocurrency becomes a phenomenon because it increases the prices are fantastic. Thus does the investment potential of gold metal has begun to recede?
investment cryptocurrency like Bitcoin also experienced a very spectacular growth, more than 1,200% in 2017.
Bitcoin price in early January 2017 i.e. $966,6/1 BTC and at the end of the year reached US $12.377/1 BTC
It was not until there, Bitcoin noted high number with $19.891 in December 2017.
If viewed from the data, gold precious metals investment be seen less attractive.
Especially when compared to the cryptocurrency could rise in the investment frenzy in a matter of hours.
Then what is this precious metal gold investment should you leave?
The answer: No. Both of these investments have different characteristics and is not a substitution. The investment principle ” high-risk high return, low-risk low return” will continue to apply to any it investment instruments.
The emergence of the Bitcoin as “Digital Gold”?
Many who call Bitcoin as “digital gold” because of the weak ties with other assets – especially stocks.
In the year 2017, even got past the Bitcoin price gold price per troy ounce.
Establishment of own price Bitcoin is equal to other assets i.e. mechanism of demand and supply.
Like gold, the amount of the Bitcoin is limited. Bitcoin needs to be mine, although not with the drill machine.
Diggers (miners) Bitcoin relies on hardware chip ASIC Bitcoin network or through a cloud, although mining through a network of cloud-prone with fraud.
After that, miners have to get a software to mine Bitcoin (Cgminer and BFGminer) and joined a group of other miners Bitcoin.
Comparison of gold investing precious metals and Cryptocurrency
Over the years, investing in gold precious metal has become a “safe haven” asset and investment is not yet known whether cryptocurrency can beat him as a “safe haven”.
According to the site Coinmarketcap.com (06/03/2018), there are as many types of 1,531 cryptocurrencies and the most famous is Bitcoin with the price per unit is highest at this time.
The price of the Bitcoin currently (06/03/2018) recorded $11.269
Let’s try to compare the gold investing precious metals investment with cryptocurrency like Bitcoin:
#1 Transparency, security, and legal aspects
Gold precious metals trading system runs are long, so easy, stable, secure, and transparent.
You can make an investment in precious metals gold through many different ways. Gold can also be purchased in the online marketplace. But be careful going to authenticity. The most important thing when you’re investing in gold precious metals is checking its authenticity.
When the gold you buy, you will get a certificate attachment and you can compare the serial number on the certificate with the serial number on the physical gold.
Gold pure precious metals are easily stored and not easily damaged. You can save Your precious metals gold at home and in a safe deposit box at the bank. Although flood or fire, gold will not be damaged.
In the meantime, if in terms of security, Bitcoin is difficult to counterfeit and stolen due to encryption systems and complex algorithms.
Bitcoin network called blockchain, contains all the transaction ever processed, allowing computer users to verify the validity of each transaction.
Even so, traders need to be vigilant with Bitcoin Mt. Gox incidents in the year 2014.
Trade agents the Bitcoin suffered a hijacking that resulted in the system being offline.
Total theft Bitcoin is estimated at $460 million (Rp6,3 trillion). Nearly all of the Bitcoin was stolen directly from Mt. Gox bit by bit since 2011. Mt. Gox himself has declared bankruptcy.
Legally, the digital theft is difficult to be traced. In contrast to a bank, transactions are transparent, anonymous Bitcoin transactions classified with the aim of protecting users ‘ privacy. But as bad, in case of theft, the offender will be difficult to be traced.
Bitcoin, as well as other internet systems, rely on cryptocurrency. Even after incidents of Mt. Gox, Bitcoin or other cryptocurrency claims to have increased their security factor, but there is no central bank or legal institution which oversees and is responsible for its value.
In conclusion, transparency, security and legal aspects of investment cryptocurrency are still too raw to be accounted for.
The number of Bitcoin worldwide limited, only a number of 21 million coins.
Based on the calculation algorithms, inventories increased average Bitcoin 4% per year, and in the year 2140 Bitcoin supply expected to be depleted.
Factor in the rarity of Bitcoin speculated would cause a bubble.
While gold is mined can continue indefinitely, with the number of small and stable production each year. An average of 2,500 – 3,000 tons of gold are mined each year.
And until recently, the amount of gold that has been mined and documented success has reached 187,200 tons of gold.
The amount of gold available on the Earth yet knowable clearly because of the continued existence of new research about the source of the gold mine.
#3 basic values
Gold has a value base that has been generally accepted as the jewelry and industrial, but the application of the Bitcoin is unclear.
Some countries are still pros and cons regarding the application of the Bitcoin as digital currencies.
#4 price fluctuations
Bitcoin has higher fluctuations compared to gold.
Price correction sharp Bitcoin reflected starting from 2017 (the highest price of US $19.891) until February 2018 (touching the lowest price US $6,000).
Bitcoin has no intrinsic value because there is no foreign exchange reserves or underlying asset that objectively determine its value.
Therefore the prices can be very volatile because there is no intervention from the central bank.
The investment has a high fluctuation of less suitable as a “safe haven”.
Compared with Bitcoin, gold was much more easily exchanged for cash (more liquid).
The market still has a high level of trust because of its reliability as a “safe haven” for many years.
From the request, the usefulness of gold also varies, i.e. individuals, industry, or the central bank.
Based on the data request gold globally in 2016-2017, some 54% of gold demand for jewelry consumption, is 10% for the tech industry, 30% for investments in precious metals, gold and 6% for the cash reserves of the central bank.
Varied uses such as this cannot be found in the Bitcoin. Bitcoin had to be used as means of payment in the future, digital, demand for gold will remain and liquid.
Reason Gold Investment 2018 (And Instead Investing In Cryptocurrency)
Although the technical perspective, the investment potential of gold appears not Frisky other investments such as the Bitcoin, here are some considerations why you need an investment of gold in the year 2018:
Up to early March 2018, the gold price per gram, he once experienced the lowest price level on January 25, 2018. Since that date up to (06/03/2018), the price of gold per gram has experienced rising 5.4%.
You can take advantage of the short-term momentum to face the risk of economic uncertainty in the year 2018 is by performing hedging.
#2 Asset Rotation
In the event of economic uncertainty, investors likely will choose the action protection by avoiding aggressive investments such as stocks.
Investors will transfer their funds to a “safe haven” investment. Therefore, gold will experience rising prices due to increased demand.
#3 Global demand strong
Beginning in 2017, the demand for physical gold itself began to suffer from an increase in the global market for example in India and China.
Based on research carried out by World Gold Council, along with growing revenue, then demand gold investment and jewelry of precious metals also increased.
In the year 2017, demand for gold in China has increased by approximately 12%. The jewelry industry in the United States also recorded the highest demand during the last seven years.
#4 Soft Dollar
There is a reverse relationship between commodity prices with the exchange rate of the US dollar, due to the majority of the value of the commodities traded in the currency’s value.
The value of the US dollar is currently turning weakened against a number of global currencies, as a result of a negative market response to the lawsuit against protectionist Us President Donald Trump.
Looking at this, you can start doing the watchlist against the price movement of gold.
#5 confidence level of Market
In the middle of a massive influx of Bitcoin in 2017, the price of gold precious metals rising against the US $.
This indicates that the precious metal gold has the resilience and confidence level of the market is in the midst of rampant investment cryptocurrency.
Even after the derivatives Institute Chicago Board Options Exchange (CBOE) launched a new product of derivatives over the Bitcoin in 2017, there is no outflow of significant gold investment from traders and institutional investors.
Gold is still “the best safe haven”, and no one can outmatch.
Whether you’ve decided will Choose to invest in gold or Bitcoin?
Although investment cryptocurrency Bitcoin looks more aggressive and seductive than gold, you have to be alert because the bubble could burst anytime Bitcoin.
So, have you decided it would be investing Bitcoin as “digital gold” or gold as a “safe haven”?
Hopefully, this article can help you to choose the investment instruments that can protect Your investment portfolio from the risk the economy might be going in the year 2018!
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