

In other words, a hedge can go up in price as inflation rises or may be relatively resistant to inflation, providing some stability to your investment portfolio. Gold, in contrast, is a physical asset that you can touch and buy online or in a physical store.Īn inflation hedge is an asset that is intended to hold or increase in value over time, thus protecting your investment portfolio from inflation. So, obviously, you can’t actually touch it, unlike gold bars and coins. You can touch gold, but you can’t touch bitcoinīitcoin is a digital currency that exists only digitally and can be bought only online. Gold, however, is what you might call its elder peer, as its history dates back more than 5,000 years. Gold and crypto: how are they different? Gold has been around much longer than bitcoinīitcoin first appeared in 2009, so, as an asset, it hasn't even reached adulthood. Gold, in contrast, might not be as easily divisible on the spot, especially if you own bigger gold bars. However, comparing gold’s and bitcoin’s use as a form of payment, bitcoin might hold an edge, since it is a fixed unit of account that's easily divisible and transportable. Bitcoin, meanwhile, is being increasingly integrated into various global payment systems. Gold was used as money in the past and can be converted to cash in almost any currency. Both gold and bitcoin are alternatives to fiat currencies In the same way, Bitcoin's total supply is just 21 million. While gold has been in use for centuries, it has a finite supply. Gold and crypto: how are they similar? Both gold and bitcoin are in limited supply Let’s start with the basics and take a look at the key similarities and differences between gold and cryptocurrencies. This has led some investors to question whether cryptocurrencies and Bitcoin, in particular, are able to play a similar role to gold within an investment portfolio.

In late 2022, the cryptocurrency market was tormented by scandals, falling prices, and investors fleeing the industry for safer havens, including gold and precious metals. The crypto industry has been on a whirlwind ride.
