Does Gold Need To Move Out Of The Way For Bitcoin And The Future Of Money?

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Does Gold Need To Move Out Of The Way For Bitcoin And The Future Of Money?

Thank you for your feedback.

Let me start by clearly stating that I do not think Bitcoin is “bad for business.”  

In fact, I am a big believer in the blockchain technology and generally agree with the author of the article you provided. Blockchain is a transformative technology that will revolutionize finance and many other domains, just like the Internet did; no question. I am also a libertarian who welcomes these changes.

I have actually studied blockchain and cryptocurrencies since 2009, which is way before they were popular.

However, I foresee that cryptocurrencies are in for a major shakeout, similar to the dot-com crash that ended the Internet boom. Cryptocurrency supporters today are saying the same thing I heard about the Internet in the late 1990s: There is a new economy and traditional valuation methods don’t apply any more.

However, history shows that this is rarely the case.

What I contend is that just like any revolutionary technology—from the steam engine and railroads to the Internet—the blockchain revolution will face a major correction. Very few players dominating the emergence of this technology will be there in ten years.  

I know, Bitcoin seems to be emerging as an unquestioned market leader, but so were AOL, Digital Equipment, and PanAm in the 1970s, 1980s, and 1990s.

My word of caution to any investor is to be very careful when speculating in assets built on an emerging technology like blockchain. Don’t speculate unless you understand the nature of your speculation and can afford to lose all of your investment.

If you want a long-term store of value, though, Bitcoin or any other cryptocurrency is not a valid option at this point. For this purpose, you want to hold a time-tested asset that retains its value no matter what. In this regard, I don’t see any real alternative to precious metals.

I hope this clarifies my views.

Olivier Garret

Olivier Garret, CEO
Hard Assets Alliance


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Why I Founded the Hard Assets Alliance

11 years ago, I became the CEO of Casey Research, a leading publisher of investment newsletters. Like me, many of our subscribers where precious metals investors, and we shared the same challenge: How do I safely buy and store precious metals? Read More...