These days, you have the option of putting your money into something called crypto, which can be equally secure as gold, once considered the most secure store of value in times of unpredictability.
While both crypto and gold offer some degree of protection for your savings during times of economic uncertainty, the former has certain distinct advantages.
While both gold and digital currency offer some degree of protection for your savings during times of economic uncertainty, crypto has certain distinct advantages.
The Case for Crypto as a Safe Asset
Accessibility
Accessibility is the primary advantage of cryptocurrency as a safe-haven asset. Unlike gold, which necessitates physical ownership and custody, cryptocurrencies can be stored and traded online with relative ease. This feature makes it simpler for individuals to invest in cryptocurrency as a safe-haven asset, regardless of their location or investment amount.
Transparency
Gold has always been regarded as a protection against the risk of economic upheaval. However, cryptocurrencies are also gaining popularity as a risk-free investment choice. When the economy is volatile, having either gold or cryptocurrency can be a good hedge. However, there are compelling reasons why cryptocurrency storage is preferable to gold.
Image: CoinCentral
Decentralization
Crypto is less susceptible to market volatility and regulations from the government due to its decentralized nature. In contrast, market forces and government interference can make gold less stable as a safe-haven asset. During the COVID-19 pandemic, for instance, many countries implemented constraints on the gold market, resulting in a shortage of tangible gold and a price increase.
Volatility
Volatility is another attribute that makes cryptocurrency a superior safe-haven asset to gold. Some cryptocurrencies are extremely volatile, whereas others are relatively predictable. This means that consumers can select the crypto asset that best suits their risk tolerance. On the other hand, the price of gold is subject to fluctuation, which can make it challenging for investors to make decisions based on correct information.
Crypto total market cap sheds a few digits and currently at $1.23 trillion on the weekend chart at TradingView.com
The potential for expansion is another benefit that makes cryptocurrencies a superior safe-haven asset than gold. The precious metal has been a safe-haven asset for many years, but it has limited growth potential.
Image: FXVNPRo
In contrast, cryptocurrencies are still in their infancy and have lots of room for exponential development. Therefore, investing in cryptocurrency as a safe-haven asset may offer both security and development potential.
Conclusion
To sum it all up, whereas gold has historically been considered a safe haven alternative, cryptocurrency is far superior. People looking for a stable investment option are increasingly drawn to cryptocurrencies due to their many attractive features, including their accessibility, transparency, decentralization, and high growth potential. Cryptocurrencies are a secure investment that are anticipated to grow in popularity as technology develops.
At the time of writing, Bitcoin was trading at $30,468, up 8.6% in the last seven days, data from crypto market tracker CoinMarketCap shows.
-Featured image from CoinNewsSpan