During an exclusive interview with CNBC, Jerome Powell, the Chairman of the Federal Reserve, expressed his view that Bitcoin is in competition with gold rather than the U.S. dollar.
Bitcoin as a Speculative Asset
Powell compared Bitcoin to gold, stating that people primarily use Bitcoin as a speculative asset, similar to how they use gold. He highlighted that Bitcoin is virtual and digital, emphasizing its high volatility. Powell emphasized that Bitcoin is not being widely used as a form of payment or a store of value, positioning it more as a competitor for gold than for the dollar.
Personal Perspective on Bitcoin vs. the Dollar
Despite the Chairman's perspective, many individuals, including the author, see Bitcoin as a valuable store of wealth. In the author's experience, Bitcoin is used as a means to preserve value, with dollars being the preferred currency for daily transactions. The author utilizes Bitcoin for specific purchases, such as buying goods at the farmers market, while viewing dollars as a depreciating asset that is best spent rather than saved.
Preference for Bitcoin as a Store of Value
The author expresses a preference for storing wealth in Bitcoin rather than gold. While gold has historically been a store of value, Bitcoin's appreciating value and utility in transactions make it a more attractive option. The author highlights the increasing acceptance of Bitcoin as a form of payment and the potential for greater returns through Bitcoin-back rewards apps.
Bitcoin's Superiority over Gold
When comparing Bitcoin to gold, the author argues that Bitcoin's potential for price appreciation makes it a more compelling investment. While gold may have stability against the dollar, Bitcoin consistently outperforms gold over time. The author predicts that Bitcoin will continue to gain prominence as a superior store of value, surpassing gold in the long run.
Bitcoin's Position in the Market
While Bitcoin may not currently rival the dollar as a medium of exchange, it is increasingly recognized as a valuable asset for wealth preservation. Despite Bitcoin's market cap being lower than that of gold, its properties and potential for growth make it a preferred choice for many individuals. Powell's comparison of Bitcoin to digital gold resonates with the author's perspective on Bitcoin's evolving role in the financial landscape.
Disclaimer: This article presents the author's opinions and does not necessarily reflect the views of BTC Inc or Bitcoin Magazine.
Frequently Asked Questions
What is a Precious Metal IRA (IRA)?
A precious metal IRA lets you diversify your retirement savings to include gold, silver, palladium, rhodium, iridium, osmium, osmium, rhodium, iridium and other rare metallics. These rare metals are often called “precious” as they are very difficult to find and highly valuable. These metals are great investments and can help protect your financial future from economic instability and inflation.
Precious metals are often referred to as “bullion.” Bullion is the physical metal.
Bullion can be purchased through many channels including online retailers and large coin dealers as well as some grocery stores.
A precious metal IRA lets you invest in bullion direct, instead of purchasing stock. This allows you to receive dividends every year.
Unlike regular IRAs, precious metal IRAs don't require paperwork or annual fees. Instead, your gains are subject to a small tax. Plus, you get free access to your funds whenever you want.
Which precious metals are best to invest in retirement?
The best precious metal investments are gold and silver. They are both simple to purchase and sell, and they have been around for a long time. If you want to diversify your portfolio, you should consider adding them to your list.
Gold: Gold is one of man's oldest forms of currency. It's stable and safe. Because of this, it is considered a great way of preserving wealth during times when there are uncertainties.
Silver: Investors have always loved silver. It is an excellent choice for investors who wish to avoid volatility. Silver tends instead to go up than down, which is unlike gold.
Platinum: This precious metal is also becoming more popular. Like gold and silver, it's very durable and resistant to corrosion. However, it's much more expensive than either of its counterparts.
Rhodium – Rhodium is used to make catalytic conversions. It's also used in jewelry making. And, it's relatively cheap compared to other types of precious metals.
Palladium (or Palladium): Palladium can be compared to platinum, but is much more common. It is also cheaper. This is why it has become a favourite among investors looking for precious metals.
Is buying gold a good option for retirement planning?
Although it may not look appealing at first, buying gold for investment is worth considering when you consider the global average gold consumption per year.
The most popular form of investing in gold is through physical bullion bars. But there are many other options for investing in gold. It is best to research all options and make informed decisions based on your goals.
If you don’t have the funds to invest in safe places, such as a safe deposit box or mining equipment companies, buying shares of these companies might be a better investment. If you need cash flow to finance your investment, then gold stocks could be a good option.
ETFs are an exchange-traded investment that allows you to gain exposure to the market for gold. You hold gold-related securities and not actual gold. These ETFs may include stocks that are owned by gold miners or precious metals refining companies as well as commodity trading firms.
Statistics
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
External Links
cftc.gov
finance.yahoo.com
bbb.org
irs.gov
How To
Tips to Invest in Gold
One of the most sought-after investment strategies is investing in gold. There are many benefits to investing in gold. There are several options to invest in the gold. Some people buy physical gold coins, while others prefer investing in gold ETFs (Exchange Traded Funds).
You should consider some things before you decide to purchase any type of gold.
- First, you must check whether your country allows you to own gold. If your country allows you to own gold, then you are allowed to proceed. You can also look at buying gold abroad.
- Second, it is important to know which type of gold coin you are looking for. You have the option of choosing yellow, white, or rose gold.
- Thirdly, you should take into consideration the price of gold. Start small and move up. You should diversify your portfolio when buying gold. Diversifying your portfolio should be a priority, including stocks, bonds and real estate.
- Remember that gold prices are subject to change regularly. You need to keep up with current trends.
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By: Nikolaus Hoffman
Title: Chairman of the Federal Reserve Says Bitcoin Competes with Gold, Not the Dollar
Sourced From: bitcoinmagazine.com/markets/fed-chair-jerome-powell-is-correct-bitcoin-is-in-competition-with-gold-not-the-dollar
Published Date: Wed, 04 Dec 2024 21:37:40 GMT
