Is Bitcoin Worth More than Gold? Hardly

You probably heard someone says lately that ‘Bitcoin is worth more than gold’. While the statement is certainly enough to get readers clicking on a headline, it’s not quite accurate. Why? Well, let’s look into the comparison…

According to Bloomberg, as of last week one Bitcoin is worth about $1,843. How much is an ounce of gold? Around $1,227. However, the daily volatility of the cryptocurrency is substantial while gold is – in comparison – much more stable. Even more importantly, when you look deeper into the world of Bitcoin and gold, you’ll quickly see than any attempt at comparison is simply ridiculous. Why? Because, for example, the fact that one share of Apple (around $155) is ‘cheaper’ than one share of, let’s say, Acuity Brands (an outdoor lighting company, currently about $178 per share) means nothing for the companies’ true value. According to Bloomberg, Acuity has a current market cap of about $7.9 billion while Apple stands at a market cap of around $814 billion. See our point?

By 2110, the suggested year when the supply of new bitcoins comes to an end, there are expected to be around 21 million bitcoins – meaning that the total market price of the electronic tokens will be a bit less than $39 billion. According to estimations from the World Gold Council, total gold stocks are worth approximately six billion troy ounces, or – in money – $7.3 trillion at current market’s price.

This means that for bitcoin to actually be worth more than gold, a singly coin will need to cost around $347,000.

All of this means nothing, of course, for traders who try to take advantage of daily volatility. For an alert trader, any volatility is a potential deal. Stay informed and stay ahead of the market.

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