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- Digital gold and cryptocurrency may go hand-in-hand as they have similar attributes concerning safety and ease of selling online
- Cryptocurrency has the potential to cater to all the needs of society due to its varied features
- Although powerful, cryptocurrency is highly volatile and should not be taken as means of exchange
The gold-cryptocurrency debate has been doing the rounds for quite some time, and we believe it’s high time we bury it. After comments from Lawrence Summers, experts feel that cryptocurrency can be useful as a form of digital gold. Investors do not have to invest much time as the transactions are hassle-free and swift. However, they also believe that cryptocurrency should be restricted to as a tool for investment. Rather than speculative or technical-based trading.
Digital gold to pave the way for investing diaspora
The digital currency has many perks to it, with ease of liquidity and lower minimum investment amount among its best. It also offers assurance in terms of quality as investors do not have to check it physically. DeFi is poised to create breakthrough patterns across the globe with its pseudo transactions. Making it a safer and secure means of payment.
Moreover, international transactions will be hassle-free and instantaneous. There are zero charges levied, and transaction charges are almost nil. As there will be a limit to the amount of currency in supply, inflation will not be an issue in such an economy. A greater trust is built among investors with their wealth secure.
Not to be viewed as means of exchange
Crypto has proved that it can turn itself into a form of digital gold. But speculators make it worse for low-risk appetite investors. Those with short-term interest to profit from an up move hamper the spirits of small retail investors. It is highly volatile in any form and tends to be used for criminal purposes as well.
No doubt that it will be a part of the system in the time to come, but it has to have some form of regulation over it.
Summers, who is also on the board of Square Inc, exclaimed that the company’s sales tripled as Bitcoin prices shot across the roof in April. A substantial increase of 14x will be reaped if the market cap of Bitcoin equals one-third of gold.
However, she also reiterated the fact cryptocurrencies cannot take up the majority of the payments as they are of least important to the global economy.
Many believe that it should not be taken as a stable means of purchasing power due to high volatility and susceptibility to malicious attacks.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
