We have constantly been hearing arguments in the past that bitcoin is “digital gold.” Both bitcoin and the precious metal the entire world has grown to love are consistently being compared, though according to one expert – Pavan Sukhdev – there is still too much speculation involved.
Pavan Sukhdev – Bitcoin Is Not a Currency
Sukhdev is the president of environmental advocacy group WWF International. In a recent interview, he commented that both bitcoin and gold remain highly speculative assets that do not quite serve the purpose of anti-inflationary tools, like so many other experts appear to suggest.
This has been a common argument over the past year and a half. Ever since the coronavirus pandemic began, many crypto experts have come out to suggest that bitcoin – very much like gold – is somehow a hedge tool that can protect one’s wealth during times of economic strife. Given how much overprinting of fiat occurred throughout the world as a means of keeping stimulus measures at hand, bitcoin took on new form under this guise and rose to more than $29,000 by the time 2021 was ready to enter the mix.
But according to Sukhdev, bitcoin is not ready for this newfound role of keeping money safe during rough times. In a recent interview, he went so far as to say that bitcoin is not even a currency, but rather an asset, and that it is nearly impossible to utilize for transaction purposes. He explains:
Bitcoin is not a currency – it’s an asset, when you have something that is as volatile as bitcoin, which goes down from $60,000 to whatever $30,000 and back up to $40,000 in the span of sharp areas. Imagine if you were buying and selling your daily shopping with one dollar in your wallet, which went up and down in value ten percent, 20 percent, 30 percent every day. I mean, how happy would you feel with that?
This is an argument we have been witnessing for several years. Bitcoin – like most major cryptocurrencies – was initially created to serve as a payment tool. Something that would potentially overpower things like credit cards, checks, and above all, fiat currencies. However, this has been a slow journey considering just how volatile the asset has been. Bitcoin is extremely vulnerable to price swings, and thus several retailers and stores have been hesitant to say “yes” to BTC payments out of fear of losing profit.
Still, this “Asset” Has Value
Still, despite what one might consider negative sentiment, Sukhdev commented that while he does not see bitcoin as a currency, he does feel it can serve as a powerful store of value in the future. He stated:
I don’t see bitcoin as an alternative currency, but I do see it as a speculative store of value, like gold or whatever. In fact, even more speculative than that.