In the future, it is very likely that we will see mainly only two assets as a store of value: Bitcoin and gold.
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What is a store of value
It can be defined in many ways, some even very technical, but in a simple sense, a store of value is a type of asset that, due to its monetary stability, is used as a haven of value by investors in the markets. A value refuge serves to safeguard or protect the monetary value (in nominal terms) of any other type of asset that is not stable or that suffers from some type of volatility; and in this sense, we can be talking about both stocks and currencies, such as commodities, as well as cryptos.
Bitcoin will one day be a store of value?
Honestly, I think there is a very good chance that it will. Obviously, I am not talking about something that is going to happen in the short to medium term, but in the very long term, perhaps in 40 or 50 years, when the massification of cryptos is already a fact.
I mean, gold is right now (always has been), a quintessential store of value, and I think it looks like Bitcoin will one day be too. Because both Bitcoin and gold share a common feature; and it is that both are finite, limited to quantities that cannot be exceeded no matter how much you want. This, in essence, is one of the things that defines a good or asset that can be used as a store of value.
Because of the limitation that defines a scarce asset by nature, the price will be affected accordingly and this will be in the form of price stability, by the law of supply and demand.
But many say that Bitcoin is already, in fact, a store of value today
And this is absolutely false, currently it is not, and the proof of this is the extreme volatility that its price constantly suffers. If we look at the value of gold, one of the things that its value reserve character guarantees is the stability of its price level. So, you will not see gold at a certain price tonight and tomorrow you will find it worth $5,000 more, which we have seen and see in Bitcoin on many ocassions.
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If we go to the facts, in the world of the stock market gold is the value resource that investors use the most (although it is not the only one). But what is currently used as a store of value in the crypto field are stablecoins. However, stablecoins are used at 1:1 to the dollar, but gold is not at 1:1 to the dollar, nor will Bitcoin be on the day it becomes a store of value.
Because in spite of all that has been said, as I have already expressed, I do think that Bitcoin will one day become a store of value, but it will not be fast and many, many things have to happen before that happens.
What it takes for Bitcoin to become a store of value
For Bitcoin to become a store of value many things are needed, but basically it all boils down to one word: Stability.
In other words, BTC must be stable in its price before it can be considered a safe haven for investors (both in the crypto sphere and in the stock market). Because from stability of an asset is that the confidence of investors is born to protect their money through it.
The limited supply of Bitcoin (of only 24 million units) is what will guarantee its stability over time at first. Because as Bitcoin gets closer and closer to its mining limit, the more valuable it will tend to be in terms of fiat money.
But in my opinion, Bitcoin is much more useful than gold, because its potential, as a means of payment and as a technology, overcome highly the gold features in all the senses. Due it gold it is only a commodity; but Bitcoin means many possibilities to the World in security terms thanks to the blockchain potential.
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Although this still cannot be seen or understood by investors (nor by almost anyone today). ), when everyone understands it in the future, I am of the opinion that Bitcoin will be considered a value store of value even greater than gold
Until that happens: What can we use as a store of value in the crypto world?
What we can use as a store of value in the crypto field are, as I already said, stablecoins. However, those of us who are immersed in the crypto world must be very careful even with stablecoins, because we already saw everything that happened with Terra USD and all the disaster that happened to it overnight. Needless to say, in the case of gold we will never see anything like what happened with Terra USD, and you may be wondering, what do I mean by this?
What I mean by this is that in the current scenario of development and unfolding of crypto, we cannot take anything for granted as a haven of value, at least not within crypto, and not yet; because what happened to TerraUSD can happen to any other stablecoin. Therefore, any stablecoin that we use in our trading and investments should be used with extreme caution.
In my opinion, the only exception to the rule is HBD, which seems extremely safe to me, and destined to become the most important stablecoin of the future. In fact, HBD is the only stablecoin that I use and fully trust, because it seems to me to be an excellent store of value in the crypto space.
This is so because HBD (HIVE BACKED DOLLAR) is a stablecoin that together with HIVE (which is not a stablecoin) form part of the value set of what HIVE is as a social platform and project.
Due all of us who currently write on HIVE are receiving HBD as a reward for our posts and our votes, and many of us exchange those HBD for HIVE in the market and then we make POWER UP on HIVE, is sure that we will see the enormous growth that this platform will have in the future.
But as I always say, I do not give investment recommendations to anyone, I am simply expressing my opinions through these posts, since everyone is responsible for what they do or do not do with their money.
In summary
Gold is a store of value today in the world of the stock market and Bitcoin will be one day.
Meanwhile, in the world of cryptocurrencies, HBD is currently, in my opinion, the best stablecoin to protect the value of our cryptocurrencies when we trade and invest.
Gold is still important (and it still will be in the future) in the stockmarket but cryptos surely overcome someday. Because although gold is tangible in the sense that you can see and touch it, and cryptos are not, we must know that crypto technology has enormous growth potential; which guarantees us that in the future, we will very likely see something intangible (as cryptos) being a store of value more appreciated than gold itself (or than any other store of value).
Something I think is certain, beyond everything that can happen and what we can see in this regard, Bitcoin and HBD are destined for greatness. Surely many more things have to happen before Bitcoin is one day established as a store of value, but today I wanted to talk to you a little about it.
What do you think about the topic discussed? Please comment.
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