Over the past few days, cryptocurrencies have captured headlines and for good reason. Bitcoin has now jumped above the $9,000 barrier, which highlights an earlier point I made on Crush The Street: buying bitcoin below the key psychological threshold of $10,000 is like free money. But amid this craze, it’s an ideal time to consider silver investments.
A decade ago, precious metals were all the rage. During the aftermath of the 2008 financial meltdown, investors scrambled for safe-haven assets. Among the available choices, none featured the proven provenance of bullion. After all, the earliest human documents mention gold and silver as vehicles of value. We don’t have the same confidence with stocks and bonds.
But now, the investment market has incurred significant change. One of those is the emergence of the blockchain and cryptocurrencies. With digital assets, an interested buyer could acquire them whenever and wherever they are. The only caveat is that they have internet access, and really, who doesn’t these days?
As such, traditional assets like silver investments have fallen out of favor. Earlier this decade, bullion experts urged investors to play the long game. They’ve been playing this disappointing game, all the while watching cryptocurrencies soar to the moon.
Can proponents of sound money still count on a revival?
Silver Investments Remain Relevant Despite the Digital Age
I believe that silver investments still maintain relevancy, even though we’re hurtling into the digital age. In fact, because we’re so deeply integrated with digitalization, precious metals are more relevant than ever.
How can I make such a claim? For one thing, bitcoin and cryptocurrencies in general are complicated endeavors. Let’s face it: the granularity of finance is convoluted enough. When you start talking about the blockchain, thing get muddy in a hurry.
Underlining this problem is that a bitcoin owner doesn’t really “own” bitcoin in how we usually define the term. Instead, in an oversimplified manner, they control transactional access to their digital assets. If something occurred that denied that access, suddenly, the practical value of that portfolio sinks to zero.
Second, cryptocurrencies, because they lack a “real” foundation, are vulnerable to third-party risks. Although unlikely, if the internet goes down permanently, digital assets crumble. Or to a more realistic scenario, if enough crypto-exchanges crumble, the entire industry could lose credibility.
On the other hand, silver investments will never lose credibility. They’ve endured regime changes, and mass-scale social shifts. They represent the only asset class that has proven the test of time. That’s an attribute which should earn a premium especially in this day and age.