While some industry veterans continue to advance skepticism concerning the future of bitcoin, some important developments are beginning to take place in favor of the digital currency. Gold-for-bitcoin trading is an emerging trend that might finally fully reinforce the belief of investors from new generation that bitcoin is headed to become an e-commerce standard. Other precious metals too are being traded for bitcoin as more companies are keen to capitalize on investment interests from China market.
Bitcoin is certainly the
new “gold rush” and has also been called “gold 2.0”. Despite the
volatility which has seen the virtual currency drop in value by as much
as 50% in a day, companies that sell gold bullions are now joining its
bandwagon. The movement from government regulated traditional
currencies, which have increasingly become unpopular with new generation
investors, to a globally accepted digital currency as things stand
seems unstoppable. Anthem Vault
from Nevada is one of the companies that have started exchanging gold
and silver for bitcoins. Many other companies are doing the same because
they have always wanted to take advantage of digital sales. Bitcoin to
some of these precious metal sellers is a safer alternative to debit or
credit cards which are prone to bad payment risks.
retailers in the precious metal industry have also discovered that by
accepting bitcoin they can actually avoid the fees of processing
payments associated with currencies that are backed by governments. For
this reason, CBMint
has joined the gold-for-bitcoin trading craze. The precious metal
retailer believes that bitcoin is the future mainstream currency and
therefore accepting it this early and fusing e-commerce will provide an
edge over its competition. Despite the skeptics terming the exchange of
gold for bitcoin as risky investments, the precious metal retailers
engaging in this trade believe that hedging options are becoming
available and getting better. In any case, volatility has not hit
bitcoin only but also gold itself by as much as 25%.
For gold to
gain entry into the bitcoin world, the market in China has a lot to do
with it too. The largest bitcoin exchange in the world in terms of
trading volume has been the BTC China. The China market was also the top
consumer of gold for the year 2013. The move of precious metal sellers
to start accepting bitcoin is therefore not much surprising as they are
definitely attracted by the synergy in this market.
greatest risk facing sellers of gold and other precious metals if they
do not accept bitcoin has to do with the expectation that the digital
currency might finally win over any other medium of exchange. If you
take bitcoin vs gold in terms of durability, portability, divisibility,
fungibility, limited supply and acceptability, the virtual currency wins
almost everything. Perhaps gold here is only a winner in terms of
durability but this is still debatable.
Considering the way things
are unfolding with gold now being exchanged for bitcoins, what looks
like a big gamble for investors to take might end up with untold victory
for them. Everyone who has not accepted bitcoin might find themselves
forced to do so later to avoid losing business. That is exactly what
happened to those who initially did not want to accept credit cards.
Gold will never be a practical currency for the new generation, but
bitcoin certainly is even at this stage without legislation. Precious
metal sellers might have finally seen the light to start exchanging gold
for the bitcoin.
Original article can be found here.