Beyond Humanity's Millennia of Consensus and Mindset: Why Bitcoin Is a Better 'Gold'

Gold, due to its scarcity and consensus, has become the king of wealth storage, but there are still risks related to storage, liquidity, and government intervention. Bitcoin, as a decentralized digital currency, is challenging gold's status with its unique advantages and bringing new wealth opportunities. This article is based on a piece by Bill Qian, organized, translated, and written by PANews. (Background: Who is the 'perfect collateral' of this era: gold, Bitcoin, or Pokémon cards?) (Background information: Chinese A-share investors are shouting for cryptocurrencies: Bitcoin is digital gold, Ethereum is Web3's Nvidia, and SOL is the blockchain casino leader.) This article is a sister piece to (How to Protect Wealth in Times of War). We will discuss the following questions: First, what exactly is wealth storage; second, why has gold become the modern winner; third, why Bitcoin will be a better 'gold' in the 21st century and beyond. For the past 5000 years, the competition for the 'best store of value' has existed, but gold, with its scarcity and a value consensus formed over millennia, has gradually become the king of wealth storage. At the same time, Bitcoin is slowly undermining and shaking gold's market position, bringing epic wealth creation and transfer opportunities to our generation. 'The History of Money' Money has three core functions: medium of exchange, unit of account, and store of value. From shells and copper coins to modern fiat currencies (like the US dollar and Euro), the medium of exchange and unit of account have been iterating continuously. Gold, silver, land, and blue-chip stocks have long been mainstream storage options. In the history of money, the dollar during the Bretton Woods System was one of the few currencies that could simultaneously fulfill the three functions of medium of exchange, unit of account, and store of value, but this was an exception and not common; moreover, the dollar's role as a three-in-one currency gradually disintegrated after Nixon's televised speech in 1971. Some might ask: why do so many people in emerging markets wish to use dollars and save in dollars, even when data shows that the dollar is continuously depreciating? I think the answer is: because they have no better choice; their local currency is worse. This topic leads us to stablecoins, which we will discuss next time. 'How Did Gold Become Today's 'Gold'?' A good store of value must meet five characteristics: scarcity, durability, portability, divisibility, and social consensus. Silver, land, and diamonds struggle to outperform gold on these five indicators. Thus, after spending thousands of years, gold finally won the consensus and mindset of humanity, becoming the almost sole target for wealth storage. 'What Are the Limitations of Gold?' 1. Storing gold requires expensive vaults and insurance, and sometimes even transportation costs, which increase with quantity. During World War II, the gold in the Paris bank vaults was directly plundered by the German army. The biggest lesson from this incident is: the safe in the bank is not safe at all. 2. In extreme times, the cost of liquidating gold is very high. Similar situations occurred during World War II; whether you were in Shanghai, Paris, or Amsterdam, gold transactions often faced high discounts, usually 30-50% lower than the spot price, and even greater discounts in high-risk environments. Worse still, trading gold in conflict areas often carries severe personal risks—once others know you hold gold bars, robbery and kidnapping are always possible. 3. Governments can further undermine the reliability of holding gold through confiscation and price controls. For example, in 1933, the US required citizens to hand over most of their gold at a fixed price below the market price, or face severe penalties. Note that at that time, the US government required all citizens to surrender their gold at a fixed price of $20.67 per troy ounce. Subsequently, in 1934, the Gold Reserve Act was passed, and the government revalued the official price of gold to $35 per troy ounce. This meant that the gold held by all citizens was 'devalued' by about 41% in just one year. The US collected over 2,600 tons of gold at that time, which directly changed monetary policy and laid the groundwork for the complete end of the gold standard in 1971. All of this occurred in the country most respectful of private property rights in the world, 20th century America. 4. Additionally, in today's digital economy, the limitations of gold being insufficiently 'digital' are also obvious. For example, you cannot send one kilogram of gold to your friend or another address via any electronic wallet. 'Bitcoin Emerged in 2009! What Is It?' In 2009, Bitcoin, created by the pseudonymous Satoshi Nakamoto, became the first decentralized digital currency. It operates on a global, public, open computer network (commonly known as blockchain, a term I find hard to understand)—a shared digital ledger that anyone can participate in and verify. New Bitcoins are generated through 'mining': computers need to solve complex mathematical problems to package transactions into new 'blocks' and add them to the blockchain, and 'miners' receive newly generated Bitcoins as rewards. This process ensures the security and smooth operation of the entire system. Related Reports: Rich Dad Warns 'ETFs Are Just Wallpaper Scams': Owning Physical Gold, Silver, and Bitcoin Is the True Path to Wealth in Turbulent Times. Experts Advocate for Fed's Powell: Bitcoin, US Stocks, and Gold Hit New Highs, Why Cut Interest Rates When the Economy Is So Good? Bitcoin Is Not as Important as RWA! BioSig Secures $1.1 Billion Funding: Targeting a $142 Trillion Tokenized Gold and Commodity Market. 'Beyond Humanity's Millennia of Consensus and Mindset: Why Bitcoin Is a Better 'Gold'.' This article was first published in BlockTempo (the most influential blockchain news media).