There are some similarities between gold and bitcoin.
“The other similarity is scarce supply. Bitcoin is engineered to slowly decline to zero growth around the year 2140, where it will reach maximum capacity of 21 million digital coins,” said Milling-Stanley. “Gold doesn’t have a set date or maximum capacity, but on average approximately 3,200 tonnes of gold have been mined every year, adding about 1.7% of the total stock of gold ever mined.”
After bitcoin, the largest cryptocurrencies are Ethereum, Ripple, Bitcoin Cash and Litecoin.
Gold has enjoyed greater demand in a low interest-rate environment as the hard asset becomes more attractive to investors compared to yield-bearing assets. However, traders lose interest in gold when rates rise since the bullion does not produce a yield. Interest rates remain low in many developed markets and some emerging markets have been rapidly lowering borrowing costs this year.
For more information on the cryptocurrency, visit our Bitcoin category.