Connect with us
Active Currencies 13538
Market Cap $2,779,088,604,202.50
Bitcoin Share 49.70%
24h Market Cap Change $1.12

Bitcoin’s sovereignty explains its pivotal distinction from Gold, Silver

3min Read

Share this article

There are fair reasons to be worried about the current fiscal and monetary stimulus in the current economic landscape. For starters, the money supply is expanding at its fastest rate since World War II, and there have been only a few times when the supply growth of money has exceeded the real out-put growth over a period of 5 years.

Global economic uncertainty is at its peak and if the central banks are unable to drive monetary debasement, other inflationary forces might come into to boost the demand for store-of-value assets such as Bitcoin. Now, the question is, are we looking at the wrong characteristics of Bitcoin, which is driving market affinity?

Bitcoin’s sovereignty and secular surroundingĀ 

For a minute, if the comparison of Bitcoin with Gold, Silver is dropped, it is important to understand that the largest digital asset is not touted to improved its purchasing power only on the basis of extreme volatility and popular price-bubbles. The main difference between Bitcoin and other “politically neutral assets” lies in its sovereign nature and its secular landscape.

Messari’s recent report, suggested that Bitcoin’s potential in the market is revolutionary because for the first time an asset has been created on a sovereign state of network based on a computer. From a fundamental point of view, it is pretty accurate.

Now, the concept of sovereignty underpins many important properties that made Bitcoin. The asset is the only monetary asset in the world with absolute scarcity and this particular feature is assured by a global network of diverse participants that run Bitcoin full nodes.

The 2nd part of its sovereignty lies in its blockchain, which serves and acts as a worldwide transparent, incorruptible, distributed ledger, that is used for transferring and storing value, and on top of that, it is politically untouched.

Unlike other fiat systems at the moment, it is impossible to restrict value transfer on Bitcoin no matter what kind of geopolitical tensions around the larger economy.

Now, in comparison to other store-of-value assets, likes Gold and Silver which can e discussed under the same set of characteristics, it is crucial to note, that these commodities do not share the same factor of portability. Unlike the monetary metals like Gold and Silver bitcoins can be sent across the world in just hours and can be securely stored by individuals with just a seed phrase.

Lastly, the report added,

“Bitcoin also has many secular tailwinds in its favor, such as the coming digitization of money and the coming into power of younger generations. The global economy has been digitizing for years, yet the monetary system has largely stayed the same throughout this period.”

Although it is extremely difficult to foresee the near-term future for Bitcoin amass price volatility, it will be hard to deny Bitcoin’s strong fundamentals and resilience in the face of the current economic meltdown.

At the time of writing, Bitcoin was being traded at $9183, with a 24-hour trading volume of $18.4 billion.

Source: Coinstats

Share

Biraajmaan is a full-time journalist at AMBCrypto covering the US market. A graduate in Automobile engineering, he writes mainly about regulations and its impact with a focus on technological advancements in the crypto space.
Read the best crypto stories of the day in less than 5 minutes
Subscribe to get it daily in your inbox.
Please check the format of your first name and/or email address.

Thank you for subscribing to Unhashed.