The Similarities and Differences Between Gold and Bitcoin: Image: Supplied

The similarities and differences between Gold and Bitcoin

One of the main similarities between gold and Bitcoin is their limited supply. That is, neither of them has unlimited resources.


The Similarities and Differences Between Gold and Bitcoin: Image: Supplied

While one is still in its infancy and the other is ancient, gold and cryptocurrency are two investment classes with some surprisingly similar attributes. Despite their distinct differences, while the two assets vary significantly in the time they’ve been around, both can provide some similar attractive benefits. 

As the two investment classes remain a popular option during inflation, comparing and contrasting the two can provide worthwhile insights.

Limited supply

One of the main similarities between gold and Bitcoin is their limited supply. That is, neither of them has unlimited resources. 

Although we don’t know exactly how much gold is left on earth, we have a reasonable estimate. The largest source of gold in history is the Witwatersrand Basin of South Africa, which has produced over 1.5 billion troy ounces of gold since it was discovered in 1886. This gold mine accounts for roughly 50% of the gold ever mined. However, its production has been steadily declining, with the total gold output of South Africa dropping below 170 tons per year since the 1970s.

Similarly, the hard limit of Bitcoin’s supply is set at 21 million coins. Of this total, 18.77 million have already been ‘mined,’ meaning 83% of all Bitcoin has already been brought into circulation within its first 12 years.

Speculative nature

Another similarity between gold and Bitcoin is their speculative nature. While gold may be less volatile than Bitcoin, buying gold as an investment is still purely speculative. This is because, on its own, gold produces no income, dividends, cash flow, or return. If an investor buys an ounce of gold today, in 10 years’ time, they will still have merely an ounce of gold. 

On the other hand, Bitcoin is similar in that it is naturally very volatile. Throughout its run, speculative interest has been the primary factor behind Bitcoin’s value. While the cryptocurrency has had significantly soaring prices coupled with a media frenzy, this similarly will likely decline as it experiences greater mainstream adoption.


Bitcoin is a burgeoning new technology. Although it had its roots a few decades ago, it has only started to disrupt the finance world in the last few years. The digital currency stored in a digital wallet was born in 2009, emerging from a white paper written under the pseudonym of Satoshi Nakamoto. Nakamoto’s vision was for a peer-to-peer digital currency decentralized from any government or bank, creating a currency that would exist on a timestamped network of transactions known as a blockchain.

On the other hand, gold has been around for thousands of years, dating back to 650 BC, when coins first started to contain gold. Since then, investors have decided to hold onto gold for many reasons, and its value has appreciated over time. This is due to its inherent value and ability to hedge against inflation when other forms of currency are unstable.

Zambesi Gold

Across multiple economic downturns and bear markets, gold has proven to be a safe haven for investors worldwide, with many traders and investors opting to invest in it to protect their capital against value depreciation, which occurs from inflation, causing an increase in general prices. Zambesi Gold, a thriving business that aims to transform mining assets into fully backed digital assets.

Self-described in its whitepaper as being “backed by real gold, real people, and real mining operations combined with real value,” the company believes that current issues in gold investing exist due to companies having “a lack of a business plan which leads to less interest and productivity.”

To solve these problems, an agreement between the Zambesi Token and its investors ensures that no fractional lending will occur. “The number of tokens will be fixed, preventing inflation. Therefore a token’s value will increase irrespective of the demand for the token or the gold price, and the amount of gold backing for each token will increase each month.”

Zambesi believes that each asset should contribute to the profitability of a business and not subsidize other assets to reduce the cost of debt. It allows token holders to be the beneficiaries of the Gold Custodian Trust, a vault where physical bullion gets stored. 

While gold and cryptocurrency both have their benefits, in today’s bear market, Zambesi believes it can benefit both worlds by combining the two. To find out about this revolutionary new product, head to Zambesi’s website today!

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