Gold or bitcoin: what's more valuable

This is stated in the report of the World Gold Council. He recalled that the metal of the highest standard became a source of profitability, which always constituted a competition to the stock market. Gold showed itself well during periods of inflation and it has a large and stable liquidity in the market.

Gold is an important part of the portfolio, since it allows you to level out the return on investment during periods of recession. "Until recently, the Crypto-currencies showed good results, but the purpose of their investments differs somewhat from the purposes of investing in gold.

Crypto-currencies have only recently been tested by various markets. Prior to the arrival of bitcoin, the market was in an incredibly low volatility, it was a bullish market with little kickbacks.

Crypto currency in the market recently, its liquidity is very scarce. However, it is very attractive for many investors, who are lured by the big possible profit, "the report says.

The council also noted that the parabolic chart of the growth of the bitcoin price was the main event of 2017, which brought the crypto-currencies into the world. While gold steadily increased by 13%, bitcoin increased 13-fold by the end of the year

"Some analysts have gone a little further, saying that crypto-currencies can replace gold, in our opinion, crypto-currency can become part of our financial system." We believe that gold is very different from crypto-currencies. "Gold is less volatile and has greater liquidity in the market .

Bidding occurs only in an established and controlled environment. Gold has a very clear role in any investment portfolio. Gold also has very little in common with the crypto currency in the field of demand and supply. All these characteristics only emphasize the fact that gold will remain the main financial asset, which, however, will continue to resonate with the digital financial world, "- say experts from the Council.

When gold was used to return currencies, its price rose sharply in terms of inflation rates. Since the collapse of the Bretton Woods system in the 1970s, gold has been growing in price, on average, 10% per annum. Bitcoin, a widely known crypto currency, has been very strong over the past few years grew in price - 13 times in just one year in 2017. However, he is very volatile - almost 10 times his volatility exceeds the dollar to gold.

A vivid example of this volatility we could see in the adjustment of its price since the middle of December last year, when bitcoin fell by almost 40% in just a month. On average, its price rises by 5% per day, this is the level of volatility, which is almost as high, as well as the VIX index recently. However, this is a good opportunity to receive a large and fast profit for investors. But you can hardly consider bitcoin as a currency. Its constantly changing market value limits its potential scope of use to the transactional token. The crypto currency has no clear two-sided market. Many assume that this is due to the mentality of investors buy-and-hold. 

Moreover, till now at crypto currency there is no such characteristic as reduction of the quantity inherent in the majority of the liquid markets. Also there is such flaw, as the commission for transaction. At the moment, it is quite high, and the transactions themselves are slow. But despite the current volume of the crypto-currency market, which is already estimated at 800 billion dollars, it is still low compared to, for example, the volume of the gold market and some other currencies.

On average, on the day there are deals with bitcoin for a total of $ 2 billion, which can be compared with the daily volume of global gold trading on the stock exchange. However, these volumes account for less than 1% of the total value of the gold market, 250 billion dollars.

Demand for gold is very diverse, and bidding with its participation is almost universally accepted and regulated on many exchanges. Credit is also widespread, but only in those countries that have recognized transactions with them legal.

It is worth noting also two extremes among the countries: Japan, for example, completely accepted crypto-currency transactions, while China decided to completely ban them. "Some experts suggested that bitcoin and other crypto-currencies are in a zone of great risk due to the possibility of sudden bans on them in different countries.

This may be due to the government's concern about capital flight, the desire to protect investors or fear of losing money, the report also says.

For example, South Korea, which now provides one of the largest markets, has recently adopted regulatory measures. And in the UK, investors encounter on their way a number of obstacles when trying to convert crypto currency.