MicroStrategy CEO: Bitcoin Is “a Million Times Better” Than Gold as a Store of Value
Michael Saylor, Chief Executive Officer of MicroStrategy, said in an interview with CoinDesk yesterday that holding gold is an archaic way of storing value. Saylor adds that Bitcoin leads all other kinds of assets, even going as far as to say that it is a “million times better” than gold as a store of value.
Fiat and Gold’s Value Is Depreciating
The statement follows MicroStrategy’s decision to pour its investments into Bitcoin after buying $425 million worth of the digital currency. According to Saylor, the current set-up of the financial sector is disadvantageous for those who keep their cash assets. He notes that the value of banknotes is depreciating because of government-induced inflation.
Saylor points out that the “purchasing power” of fiat money is degrading fast. He added that the financial events following the impact of COVID-19 were felt in the sector. The current situation pushed them to look for other asset alternatives to precious metals and cash.
“Ultimately you have to find something which you can’t print more of that doesn’t have its fundamental underpinnings tied to a fiat currency, and the only thing that I can find right now is bitcoin.”
Scarcity as an Attribute of a Safe-haven Asset
Saylor said that the scarcity of an asset and the contribution of its producers play a role in determining whether it can be a good store of value. He took gold as an example. While gold is relatively scarce as a commodity, it can still be produced indefinitely. The difference in the interests of gold miners and gold bugs make this interaction detrimental to gold as a safe-haven asset.
“The gold miners are the enemies of the gold holders. The gold miners are trying to destroy your value, right? They’re not trying to help you.”
Saylor also believes that in the near future, investors will migrate their funds to Bitcoin. How and when this will happen is still unknown but he thinks that as gold loses its status as a superior store of value, Bitcoin will be the other option available.
While there are blue-chip stocks that seem like safe bets for investors, how they will perform in the coming months is still unpredictable. Inflationary measures are still expected to persist in the near future and it is expected to impact blue-chip stocks as they peg their value on fiat currency.
When asked about a safer store of value that exhibits scarcity and independence from the fiat, Saylor said that:
“The only thing that I can find right now is Bitcoin.”
On a similar note, JPMorgan had also published a research note yesterday showing that institutions are investing in Bitcoin more than gold.