We have often talked about Bitcoin being a replacement for gold and not fiat. This is because it is treated as a store of value like Gold and has limited transactional capabilities. But recently, we have heard something new from the head of commodities of Goldman Sachs. He has said that Bitcoin replaces copper and not gold. According to him, Bitcoin is a “risk-on” inflation hedge like copper, while gold is a “risk-off” hedge.
Bitcoin is more like copper! Is it?
Even though I would not like to agree to this because I love Bitcoin, the man got the point. He says that Bitcoin is comparable to copper and not gold because of the risk involved in it. There is only a 10-year price history of Bitcoin, and that makes it a really risky investment. It is no doubt a hedge to inflation, but unlike gold that is considered safe, the same cannot be said for Bitcoin. And since copper also falls in the same category along with oil, they both are comparable.
Image source: Mint
He also added the there is good and bad inflation. For example, gold is a hedge to bad inflation that happens when the supply of chips, commodities, and raw materials is curtailed. It is still difficult to believe that Goldman Sachs has compared copper with an asset that has given average returns of 250% from the day it was made till now.
Differing statements from Goldman Sachs
There are many who don’t like Bitcoin or have a particular view of it. That is fine because, ultimately, everyone has their beliefs. But Goldman Sachs is among the view that has changed their statements on Bitcoin time and again. A while back, they said that “Bitcoin is the retail inflation hedge,” and now they are comparing BTC to copper. We all have been comparing BTC to Gold, and suddenly, they say that it is comparable to copper. Even the authorities say that BTC is a replacement for Gold and not fiat.
I still think that BTC is a replacement for Gold and not copper. Doesn’t it seem that these banks make contradicting statements based on the price of Bitcoin? And what are your thoughts on Goldman Sachs saying Bitcoin replaces copper? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.