Brian Armstrong, the CEO of Coinbase, argues that Bitcoin is preferable to gold due to its scarcity, portability, and divisibility.
According to Brian Armstrong, CEO of Coinbase, Bitcoin is a superior form of currency to gold due to its scarcity, portability, divisibility, utility, and performance.
Armstrong’s remarks were in response to Governor Lesetja Kganyago of the South African Reserve Bank (SARB)’s opposition to the establishment of a Strategic Bitcoin Reserve (SBR). Kganyago refuted the notion, challenging the strategic utility of Bitcoin as a government-held asset.
Armstrong recently expounded on the advantages of Bitcoin over gold in a post on X (formerly Twitter).
“Bitcoin is a superior form of currency. It possesses the decentralization and scarcity of gold, but it is more divisible, portable, and (I believe) even fungible.” Armstrong wrote, “It is comparatively more difficult to determine whether gold is pure or contains lead in the center of the bar.”
He noted that the market capitalization of Bitcoin, which is approximately $2 trillion, is 11% of the market capitalization of gold, which is roughly $18 trillion. The CEO stated confidence that Bitcoin’s market capitalization could surpass gold within the next 5-10 years, thereby rendering Bitcoin reserves more significant than gold reserves.
Consequently, he contended that nations possessing gold reserves ought to allocate at least 11% of their reserves to Bitcoin.
“I believe that a significant number of the G20 countries will follow if the United States takes the initiative in establishing a strategic Bitcoin reserve,” he concluded.
Kganyago’s comprehensive post was in response to the discussion at the World Economic Forum in Davos, during which he expressed skepticism regarding governments’ ownership of Bitcoin reserves.
The SARB governor rejected the notion of advocating for a specific asset without a strategic objective. Additionally, Kganyago underscored the rich history of gold as a store of value.
He characterized the debate as a public policy matter that necessitates a more comprehensive approach, cautioning against industries that attempt to impose their products on society.
Armstrong responded by emphasizing Bitcoin’s exceptional performance over the past decade. He emphasized that governments should treat Bitcoin as a store of value and progressively increase their holdings over time.
Armstrong suggested that it may initially make up 1% of their reserves, but it will eventually surpass or equal gold reserves.
In the interim, SBR continues to expand its market share. Wyoming, Massachusetts, Oklahoma, and Texas have introduced legislation to recognize Bitcoin as a strategic asset.
In addition, at least 15 states in the United States, including Pennsylvania and Ohio, are currently engaging in discussions regarding the establishment of Bitcoin reserves. To establish a “national digital asset stockpile,” President Donald Trump also issued an executive order. This action has facilitated the implementation of a more structured approach to the integration of digital assets into the nation’s financial strategy.
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