Encrypted digital currency Bitcoin is now more valuable than gold. (Wikimedia Commons)
By: Jimmy Kakish
History was made Thursday as the value of a single Bitcoin exceeded that of an ounce of gold for the first time ever.
By Friday, the encrypted digital currency was worth $1712.06, compared to $1228.7 for a troy ounce of gold.
Around the same time last year, Bitcoin’s value sat at around $360, nearly five times less than where it’s sitting now.
The value of Bitcoin rose to around $760 in the weeks leading up to the UK’s referendum to leave the European Union in June.
Following the Brexit, Bitcoin’s worth fell slightly, only to rise again following the U.S. presidential election.
Considering Bitcoin’s most recent climb over gold, Alex Lawn, the founding director of Crypto-Consultancy Ltd says that he’s glad the currency is starting to get recognized.
“Bitcoins utility is [now] understood a lot more as a store of value and a means of transferring wealth effortlessly and [without borders which is] something gold can’t [do],” he said
Some of its users predict that it’s only going to keep going up.
“Bitcoin is set to have the maximum of 21 million Bitcoins. There [are] less and less bitcoins being created, so if [the demand is the same or higher], the price must rise,” said Will, a longtime Bitcoin user who did not want his last name used.
Only 21 million Bitcoins are allowed to be created, but the cap isn’t expected to hinder the currency’s growth.
“There’s a lot of pent up excitement in the Bitcoin and cryptocurrency space. Every day something new is being built, deployed and impacting this part of the cyber world,” said Ejay Eladia, another longtime Bitcoin user.
“There is really no limit to what this technology can and will do,” he said.
A Bitcoin investor and project manager at Prudential Financial said that even though one Bitcoin is worth more than an ounce of gold, people should take into consideration that the gold market is 500 times larger.
“For Bitcoin to really be worth more than gold, it will need to trade at about $500,000 a coin,” said Ken Ashe. “Its recent climb has been quick, and I can see it falling in value soon. That said, I think it will be worth more in year than it is today.”