World Gold Council doesn’t state Bitcoins as Digital Gold
Feb 03, 2018 Posted / 22854 Views
In its recent investment update, the world gold council refused to call Bitcoins as Digital gold due to high volatility and risk involved in the investment. The council admitted, on the one hand, the value of gold has risen by 13% and on the other hand value of bitcoins got further multiplied 13 times in a year.
As we are aware of the fact that the main reason behind the existence of world gold council is to maintain demand of the gold, provide leadership to the industrial sector and be authoritative on the global gold market.
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The council has differentiated real gold and so-called virtual gold on various aspects as follows:
From the report, it is clear that the Gold council aims at sustaining demand of gold and keeping its status above digital currency. Following this, they will not promote Bitcoins in place of gold as an investment.
It is also claimed by the council that by usage of digital currency in place of centralized currency, the government will lose its control of the economy. As government uses various tools such as the monetary policy to maintain balance in the economy. By the usage of digital currency instead of fiat currency, these tools will become less effective. In the report, virtual coins are stated as disruptive to the existing banking system as it has been banned in various countries.
Further criticizing the virtual gold the council stated that there is approximately 5% average change in cryptocurrencies on the daily basis which cannot be characterized as a feature of a currency. The council suggested that the virtual currency is only appropriate for those investors who look for extremely high returns.
From the recent report, it can be concluded that the gold council doesn’t support cryptocurrency but it does support the technology behind it i.e. Blockchain technology. The council is thinking of transforming the gold into ‘Virtual Asset’ by the usage of private networking.
Appreciating the blockchain technology the council commented that distributive ledger mechanism is very innovative and can serve in an effective manner to the Finance sector. Various organizations are working on the idea of transformation of Gold into a virtual asset by the usage of innovative technology.
It would be interesting to see that whether the agency will succeed in positioning gold as a substitute for Bitcoins.
Applancer is an open platform for discussion on all things like Blockchain , Cryptocurrency and Ico news updates. As such, the opinions expressed in this article are the author's own and do not necessarily reflect the view of Applancer .
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