TURNMIRE TRADING NEWS MINUTE
Is Bitcoin Just “Digital Gold”? Not Even Close…
The meteoric rise of Bitcoin has left many scrambling to define it. Is it a store of value, a new form of money, or a rebellion against traditional finance?
These attempts at categorizing it highlight the unique nature of Bitcoin — a revolutionary technology that doesn't fit neatly into existing boxes.
One popular comparison likens Bitcoin to "digital gold."
In some ways, the analogy holds weight. Both have been prized for their scarcity. Over the past 4,000 years, only about 6.8 billion ounces of gold have been mined, with an annual new supply of roughly 118 million ounces.
This means it would take roughly 60 years, at current mining rates, to double the global gold supply.
Here's where the comparison falls short: finite, but not fixed.
The key difference lies in supply.
Unlike gold, Bitcoin was designed with a hard cap of only 21 million coins ever to be mined.
As of today, the roughly 19.66 million Bitcoins already in circulation have taken just 15 years to mine, while the remaining 1.3 million will take over 100 years to mine, thanks to a programmed "halving" event that cuts miner rewards roughly every 4 years.
Imagine a gold mine where your output gets halved every few years — that's the essence of Bitcoin's supply dynamics.
This built-in scarcity is a core driver of Bitcoin's value.
Unlike traditional assets with ever-increasing supply, Bitcoin boasts a constrained supply that's actively shrinking.
So, while Bitcoin shares some traits with gold, its unique supply mechanics set it apart.
Perhaps, the true value of Bitcoin lies not in mimicking traditional assets, but in ushering in a new era of digital scarcity and value transfer.
The question remains: are we witnessing the dawn of a new asset class, or simply the evolution of money itself?
— The Jeffry Turnmire Trading Team
|
|
No comments:
Post a Comment