How Much Bitcoin (BTC) Countries Would Need To Replace Their Gold Reserves?
Any person who follows the crypto market should know that Bitcoin has the potential to become the new digital gold. The cryptocurrency has so much potential that several people claim that it can even become the next reserve currency of the world.
Now, Blocktown Capital has made an interesting study for the people who share this view. The digital asset management company has estimated the amount of BTC that would be needed in order for governments to accumulate BTC if they decided to replace the gold that they own.
The United States would have to buy more Bitcoin than any other country in the list, totaling 913,388 BTC in gold. Germany comes in second with 378,416 BTC and Russia in third, with 232,033 BTC. Then we have China (206,923 BTC), Japan (85,931 BTC) and the United Kingdom (34,846 BTC). This is a lot of Bitcoin, that much is a certainty.
Will Bitcoin Really Be Able To Replace Gold?
Recently, even people that did not previously believe in BTC like Niall Ferguson, an economic historian, has affirmed that it has some similarities with the gold industry. Some say that it is even better than gold because it is fully digital. The World Gold Council obviously believe that BTC is no gold, but they would defend this idea in any situation.
The real question here is: can Bitcoin really replace gold? Is this a good bet? Is it a far-fetched assumption that will not turn into reality?
One of the main advantages of Bitcoin is that no government or group in the world will be able to confiscate your BTC. For instance, the Bank of England has recently cut Nicolas Maduro off Venezuela’s gold reserves. Max Keiser, a Bitcoin maximalist, has affirmed at the occasion that Bitcoin simply cannot be confiscated, so it is better than gold.
Bitcoin is also 100% politically neutral. You do not have to trust banks or anyone else, for that matter. You simply need to store your money and take care of it. Legislation often changes, as institutions do. Bitcoin is more secure and stable than all that.
Most of this neutrality comes from the fact that Bitcoin is not directly linked to any government and that it is fully decentralized. To some people, Bitcoin can change the concept of money as much as the internet has changed the concept of information and this will cause a massive revolution.
However, there are barriers that need to be overcome in order to turn this plan into reality. BTC needs more adoption than it has right now and it also needs to scale better and create a better user experience. Only then the crypto asset will finally be ready for mainstream use.
When the acceptance of Bitcoin finally reaches this level, then maybe the central banks will rush to buy BTC instead of gold.