Can Bitcoin become a digital version of gold? While many onlookers have mulled over this pertinent question for years on end, in the eyes of Mike Novogratz, the flagship cryptocurrency is well on its way to achieving such a status.
Bitcoin Is Gold On Crypto’s Periodic Table
In a comment issued to Bloomberg TV’s Middle East branch, Novogratz, the founder of crypto merchant bank Galaxy Digital Holdings, remarked that just as each element on the periodic table corresponds to an atomic number, Bitcoin is the only viable store of value in the cryptocurrency landscape. The former Goldman Sachs partner even noted that Bitcoin’s slow block times and low transactional throughput just accentuate that it is like gold, likening storing the cryptocurrency to how precious metals are kept in Fort Knox.
This isn’t the first time that Novogratz, once the roommate of Ethereum co-founder Joseph Lubin, has taken to public forums to pledge his allegiance for the digital gold argument. On an appearance on CNN Business in September of last year, Novogratz made a comment that was quite reminiscent to the aforementioned. He claimed that Bitcoin has been “vested with a store of value [status}” by investors, adding that utility tokens, blockchain-based security assets, and other subsets of cryptocurrencies won’t ever come close to becoming digital gold.
While Novogratz is adamant in his belief that Bitcoin is more digital gold than anything else, some have claimed that this is pure hearsay. Industry commentator Jason Smith personally remarked that BTC “already is money,” rather than an asset of a different classification. Moreover, in Satoshi’s magnum opus, the original Bitcoin whitepaper, the cryptocurrency’s premise was explained as a “peer-to-peer electronic cash system.”
It’s Gold, Not Digital Cash
Regardless, most, not just Novogratz, have come to the conclusion that the project in its current state is much better suited as a digital store of value than some semblance of a medium of exchange.
Even Nick Szabo, a contender for being the face behind the Satoshi Nakamoto moniker, had made comments that the cryptocurrency has many values that make it resemble the precious metal. In a surprising comment made at the inaugural Israel Bitcoin Summit, the American cryptographer noted that central banks may look into replacing their gold holdings for Bitcoin, especially due to the former’s “physical vulnerability.”
Just days ago, Barry Silbert, the chief executive of the New York-based Digital Currency Group, exclaimed that Bitcoin has already won the digital gold race. Citing anecdotal evidence, Silbert explained that when millennials are clamoring for a store of value, they’ll turn to the cryptocurrency, not gold. The Digital Currency Group founder even commented that the legacy money currently situated in gold holdings will eventually flock to Bitcoin, especially due to the digital asset’s decentralized, secure, and non-sovereign characteristics.
Former Blockchain product manager Dan Held once even embarked on a rant to underscore his belief that Satoshi never meant for Bitcoin to inherently be digital cash, but a store of value that transcends traditional boundaries.
1/ Satoshi’s Vision™ is a silly endeavor, as it doesn’t matter what it was, we are where we are now. However, those pushing the “Bitcoin was first made for payments” narrative insist on cherry-picking sentences from the white paper and forum posts to champion their perspective.
— Dan Hedl (@danheld) January 14, 2019
As reported by Blockonomi on a previous date, in a sweeping 47-part Twitter thread, Held noted that Satoshi him or herself mentioned gold, long-term value growth, Bitcoin’s status as a commodity, and even scarcity. This in and of itself led the commentator to conclude that the pseudonymous coder didn’t intend for the first iterations of Bitcoin to be used actively in day-to-day life through digital merchants.
This was far from the end of Held’s argument. The co-founder of crypto asset manager Interchange drew attention to the network’s cardinal commandments — 21 million BTC supply cap, ten-minute blocks, and block size caps — claiming that Satoshi could have altered these values to push the digital money narrative. But the cryptocurrency godfather didn’t.