Why this ‘Biggest Bitcoin challenge’ is a bonus
Bitcoin‘s rising popularity with institutions and investment professionals such as BlackRock CEO Larry Fink and hedge fund legend Stanley Druckenmiller has helped Bitcoin stand its ground against Gold. Considering the former’s prospects as a scarce store-of-value over the latter, a war of words often emerges between gold bugs and the bitcoin community.
While many Bitcoin proponents saw Bitcoin as Digital Gold or Gold 2.0, Peter Schiff, (of Euro Pacific Capital) one of the loudest proponents of gold, maintained his skepticism towards bitcoin.
The latest war (of words) on Twitter resurrected the age-old debate of Bitcoin vs gold. Billionaire investor and entrepreneur Mark Cuban and Oliver Renick, Gold bug (from TD Ameritrade), exchanged their thoughts on both assets.
In a tweet, Renick slammed Bitcoin’s comparison to digital gold because “Bitcoin is making no discernable progress towards digital gold. Why are we still assuming it will at some point in the future?”
The Shark Tank star responded, by stating a few reasons why bitcoin was indeed better than gold.
“Its BETTER than gold. No worries about storing it. Easy to transfer. Easy to trade. Easy to convert. Doesn’t require an intermediary. Can be fractionalized. Biggest BTC challenge? No William Devane type commercials and all the people who believe gold is an inflation hedge.”
TD Ameritrade’s Oliver Renick, in response to Cuban, stated that he doubted Bitcoin’s progress by adding that bitcoin’s ‘relationship with real interest rates was as random as it was on day 1 ten years ago’.
In a report published by Renick recently, he opined:
“See any trends? Me neither. It looks completely random with no trend over the past nine years of data; sometimes positive, sometimes negative. But what’s most important here is that it’s not getting more negative over time. “
“Gold is useless, pretty much across the board, but particularly as a hedge. BTC is a digital asset that is similar to gold because they both are driven exclusively by supply and demand. BTC does a better job with both,”
Gold, according to, Renick was remarkably consistent in its negative correlation with real interest rates i.e., its utility. He added ‘Until BTC does something resembling this, not sure why we call it gold. At least from a financial sense,’
Following this argument, Cuban acknowledged one aspect: even though Gold at the press time had more demand than Bitcoin, the narrative will flip; he stated:
“So are a lot of assets including stocks. That isn’t a utility. That’s supply and demand. Gold has more demand. IMO, that will change going forward. Why? Because BTC is easier to transact. In the time it will be better understood and marketed and the gold market will shrink.”
Reality Check: BTC vs Gold
Philipp Sandner from Frankfurt School Blockchain Center made a comparison between three assets: Gold, Bitcoin and Fiat (euro),Source