At the time of this post Bitcoin is worth USD $896.05, an increase of $453.21 since this time last year, and it’s approaching the price of gold which is $1,132.64 / ounce today.
Bitcoin is up $172 since November and shows no signs of stopping there but can it overtake the price of gold, and what does it mean if it does?
Technically it means nothing, but you can bet your Bitcoin the media will be in a frenzy when it happens because it makes for such an interesting comparison and discussion.
The obvious question to ask might be “Is Bitcoin the new Gold?”.
Well, the answer to that question might just depend on your age and which country you live in. We know for a fact millions of gamers value digital items more than they do real world items, so maybe it isn’t a stretch to conclude Bitcoin might just be more valuable than gold in the minds of millennials.
But even if this is true I find it difficult to get too excited when what was once a decentralized currency, no longer is. China’s Bitcoin miners control around 70% of all Bitcoin mining, and 90% of daily transactions, and if the Chinese government suddenly decides to take control of this economy then Bitcoin is in big trouble.
We’ve already seen Chinese miners collude in order to resist implementing code changes, and it’s very unlikely this collusion will end any time soon, so perhaps for now we’ll call Bitcoin “China’s new Gold” and wait and see how it pans out.
What are your thoughts on China’s new gold and the lack of decentralization?
Leave a comment below.