BITCOIN AS DIGITAL GOLD: BETWEEN PROMISE AND REALITY

This paper explores the growing perception of Bitcoin as “digital gold” by examining its economic characteristics, historical evolution, and role in modern investment strategies. While gold has long served as a safe-haven asset and store of value, Bitcoin, launched in 2009, is a relatively new and volatile digital asset. However, both share several core attributes: limited supply, difficulty of production, and their appeal in times of economic uncertainty. The study conducts a comparative analysis of Bitcoin and gold, focusing on shared traits such as scarcity, production effort, and store-of-value properties, while also highlighting key differences in tangibility, regulatory environment, volatility, and energy consumption. Empirical research from recent years suggests a shift in how investors perceive Bitcoin, particularly after 2017. Studies such as Zwick & Syed (2019) identify a structural transformation in the correlation between Bitcoin and gold, with the two assets now increasingly moving in parallel, especially during periods of financial turmoil. Despite these convergences, Bitcoin faces significant challenges. Its scalability limitations, legal uncertainties, high energy demands, and dependency on market-driven mining incentives raise questions about its long-term viability and security. Moreover, the fragmented regulatory landscape across jurisdictions hinders its adoption as a fully mature financial instrument. Yet, there are promising signs of market maturation, such as institutional adoption, improved financial infrastructure, and regulatory clarity in certain regions. Ultimately, the paper concludes that Bitcoin has not yet fully attained the status of digital gold, but current trends suggest a gradual convergence in that direction. If it succeeds in stabilizing its volatility, reducing environmental impact, and achieving global regulatory coherence, Bitcoin could become a complementary store of value to gold, playing an integral role in the evolving architecture of the digital financial economy.

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Publication Details

Journal
International Journal of Research In Commerce and Management Studies
Published
2025-01-01
DOI
https://doi.org/10.38193/ijrcms.2025.7308
Primary Topic
Blockchain Technology Applications and Security
Type
article
Field-Weighted Citation Impact
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article

BITCOIN AS DIGITAL GOLD: BETWEEN PROMISE AND REALITY

Tudor-Gabriel Budisteanu
International Journal of Research In Commerce and Management Studies
Blockchain Technology Applications and Security
article

BITCOIN AS DIGITAL GOLD: BETWEEN PROMISE AND REALITY

Tudor-Gabriel Budisteanu
article en

Abstract

This paper explores the growing perception of Bitcoin as “digital gold” by examining its economic characteristics, historical evolution, and role in modern investment strategies. While gold has long served as a safe-haven asset and store of value, Bitcoin, launched in 2009, is a relatively new and volatile digital asset. However, both share several core attributes: limited supply, difficulty of production, and their appeal in times of economic uncertainty. The study conducts a comparative analysis of Bitcoin and gold, focusing on shared traits such as scarcity, production effort, and store-of-value properties, while also highlighting key differences in tangibility, regulatory environment, volatility, and energy consumption. Empirical research from recent years suggests a shift in how investors perceive Bitcoin, particularly after 2017. Studies such as Zwick & Syed (2019) identify a structural transformation in the correlation between Bitcoin and gold, with the two assets now increasingly moving in parallel, especially during periods of financial turmoil. Despite these convergences, Bitcoin faces significant challenges. Its scalability limitations, legal uncertainties, high energy demands, and dependency on market-driven mining incentives raise questions about its long-term viability and security. Moreover, the fragmented regulatory landscape across jurisdictions hinders its adoption as a fully mature financial instrument. Yet, there are promising signs of market maturation, such as institutional adoption, improved financial infrastructure, and regulatory clarity in certain regions. Ultimately, the paper concludes that Bitcoin has not yet fully attained the status of digital gold, but current trends suggest a gradual convergence in that direction. If it succeeds in stabilizing its volatility, reducing environmental impact, and achieving global regulatory coherence, Bitcoin could become a complementary store of value to gold, playing an integral role in the evolving architecture of the digital financial economy.

International Journal of Research In Commerce and Management StudiesVol. 07(03)
Bucharest University of Economic Studies (RO)
Openalex Percentile: Top 83%
Blockchain Technology Applications and Security
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BITCOIN AS DIGITAL GOLD: BETWEEN PROMISE AND REALITY — Tudor-Gabriel Budisteanu · International Journal of Research In Commerce and Management Studies (2025) | TGRS Research Map | TGRS