28 Nov 2014
Citi Chief Economist says Bitcoin is closest commodity to Gold – CoinDesk
FXStreet (Barcelona) - The CoinDesk Analysis Team, cite Citi’s chief economist’s comments that Gold is a commodity like bitcoin and other cryptocurrencies, ahead of a Swiss vote that could cause the global gold price to spike.
Key Quotes
“”Gold as an asset is equivalent to shiny bitcoin," he wrote in his note to clients.”
“Gold, Buiter continues, is unlike any other commodity, but bitcoin and cryptocurrencies bear the closest resemblance to it. Like gold, bitcoin has to be mined, is limited in supply and has no significant utility.”
“He also notes that both gold and bitcoin are anonymous to a degree and are "outside assets", that is, assets that are not a liability to any other party.”
“Both gold and bitcoin are, in Buiter's view, in "benign bubbles". The analyst argues that since fiat money is intrinsically useless, it should be valued at zero in a hypothetical economy in a state of 'fundamental' equilibrium. Gold's positive value therefore shows that it is in a bubble, Buiter says.”
“"The gold bubble, is, of course, pretty impressive ... It has had a positive value for nigh-on 6,000 years. That must make it the longest-lasting bubble in human history," he writes.”
“The fact that gold is in a bubble is no indicator of its future value, Buiter says. The same would apply to bitcoin's future price. Investors in either asset, then, should brace themselves for "an exciting ride", he says.”
Key Quotes
“”Gold as an asset is equivalent to shiny bitcoin," he wrote in his note to clients.”
“Gold, Buiter continues, is unlike any other commodity, but bitcoin and cryptocurrencies bear the closest resemblance to it. Like gold, bitcoin has to be mined, is limited in supply and has no significant utility.”
“He also notes that both gold and bitcoin are anonymous to a degree and are "outside assets", that is, assets that are not a liability to any other party.”
“Both gold and bitcoin are, in Buiter's view, in "benign bubbles". The analyst argues that since fiat money is intrinsically useless, it should be valued at zero in a hypothetical economy in a state of 'fundamental' equilibrium. Gold's positive value therefore shows that it is in a bubble, Buiter says.”
“"The gold bubble, is, of course, pretty impressive ... It has had a positive value for nigh-on 6,000 years. That must make it the longest-lasting bubble in human history," he writes.”
“The fact that gold is in a bubble is no indicator of its future value, Buiter says. The same would apply to bitcoin's future price. Investors in either asset, then, should brace themselves for "an exciting ride", he says.”