The Speculation of Gold vs. Bitcoin as Money

Gold has historically demonstrated a lack of effectiveness as a form of money, evidenced by its significant price decline over a 20-year period. Its impracticality for everyday transactions, compounded by the inability to establish a banking system around it and its cumbersome nature for trade, led to this volatility. Consequently, it has not established sufficient market liquidity for its use as a currency. In contrast, both gold and Bitcoin can be viewed as speculative assets, hinging on the probability of becoming the dominant form of money. With Bitcoin viewed as having a higher potential to achieve this status due to its digital nature and adaptability, its speculative value could reach vastly higher market caps if fiat currency collapses. The argument suggests that while gold currently holds a sizable market cap, much of its value relies on future re-monetization expectations rather than present utility. This speculative framework implies that Bitcoin, with its potential to capture market share from traditional stores of value like gold, may ultimately provide significant returns as it gains acceptance as a medium of exchange.