With BTC, you have to find a trusted exchange and a trusted wallet. The average consumer doesn't really know anything beyond a google search and the first two results.
Actually, it's not. It's nearly impossible to non-destructively distinguish gold from tungsten wrapped in gold.
You can also test shear forces on the bar, a test you can perform easily at the bank itself (or any of the other material forces tests really). Those do usually require a bit of machinery.
Lastly, you can measure electric resistance. A gold bar will have a different resistance than a tungsten bar, especially if you compare a frequency sweep AC resistance vs DC resistance (if there is a difference, which should be about 20nOhm/m vs 50nOhm/m for Gold/Tungsten, you know the material has a core that is different from the outside).
Electric current mostly travels on the surface of a material. Gold-plated tungsten might not have sufficiently different resistance from pure gold, if the plating is thick enough.
The higher the frequency the less you penetrate the material (self-induction in the material forces the electrons outwards).
This enables you to effectively do a sweep of material composition by increasing frequency and measuring the resistance. In theory you could even tell if the core was not conductive at all (due to the resistance not changing despite lower frequency).
So even if the plating was thick, you would be able to tell because the resistance curve begins to change at lower frequencies due to Tungsten having a higher resistance.
If your device is really accurate you could even measure the rough area of the core since skin effect is proportional to the square of the resistivity.
Considering how expensive gold is per ounce, it's not like any of us will be buying it by the bar.
Executive Order 6102.
If you're in a country where you can't trust the government, you lost. The government can take away your gold, your government can take away your bitcoins.
If "the government has become the enemy" is a problem, then you've got bigger problems at hand.
The next best is to use a trusted dealer and buy the mint products that have verifiable serial numbers. For example:
https://www.apmex.com/product/98353/1-oz-gold-bar-royal-cana...
Canadian Mint 1oz bar, at a small mark-up over the price of gold. Comes sealed and has a serial number.
Created by the US Mint, you have strong assurances that you are recieving in fact, 91.67% gold / 22 karat (an alloy, because pure gold is too soft for the typical consumer).
If you do want 99.99% Gold / 24 karat, the US Mint also makes the Buffalo coin. But that's usually harder to store.
American Eagle coins are super easy to obtain and trade. Just go to any gold shop and ask for an American Eagle gold coin.
1 oz American Eagle coin direct from the mint? $1,490 [2]
That's a 23% "transaction fee". You'll get much much lower buying gold (or bitcoin) from somebody else.
[1] http://www.kitco.com/charts/livegold.html
[2] https://catalog.usmint.gov/american-eagle-2018-one-ounce-gol...
You buy them at only a bit higher than spot price from 3rd party distributors. For example: https://www.apmex.com/product/1/1-oz-gold-american-eagle-bu-...
American Eagle coins have a slight premium, due to their guarentee by the USA Mint itself. If you don't care about serial numbers and want to just have bullion, you can buy other gold coins. But American Eagles are great because they are enforced by the powers of the US Government itself. So you get a bit of security (and therefore, the price of the coin is slightly higher compared to gold).
But not much higher. Really, it isn't. Checkout 3rd party sites like apmex or your local gold shop if you don't believe me.
They also make a non-collector version and sell them to bullion dealers, who then mark them up modestly for retail. To get access to them direct, you're probably buying hundreds of coins at a time.
Bitcoin advantage: weighs nothing, highly transportable. Gold not so much.
Not so important for a store of value.
> Bitcoin advantage: weighs nothing, highly transportable. Gold not so much.
Yet requires an order of magnitude more skill and overhead to handle.
> what advantage does it have over gold?
can you point me to words "store", "of" and "value" in the above question?
> order of magnitude more skill and overhead to handle
only if you assume handling gold means dropping the gold bar in your basement and never touching it again?
Bitcoin is up the past couple of weeks. So inevitably, the BTC community will be calling it a store of value.
I think the general community is just reacting to the moving goalposts. When BTC's value is up, its a store of value. When its value is down, BTC's value is its transactions.
Plus buying stuff online is more tricky.
I could envision alternative reality though, where there are companies specializing in providing tokens that have 100% coverage in gold. You would need to trust them and their software, but some trust is always involved. The problem is those would be an easy target with physical holdings (so the problem of the gov comes back, but they could choose under which gov to operate). In that scenario, if the problem gets big enough the gov will take care of it, no matter where on the planet is that gold. In the case of Bitcoin though, while temporarily it can be hampered very easily, it's quite impossible to make it completely go away.
The biggest point for gold IMO which you didn't mention, since all value comes from people and their beliefs, is thousands of years vs 10 years.
If you're to the point where some authority is forcefully taking your assets away, I'd much rather have physical possession of gold than Bitcoin. You can bury gold somewhere and pretend you don't have it. Bitcoin, on the other hand, takes place on a public ledger, so they can, in theory, always track it down. And a thug who's willing to take your gold at gunpoint will be equally happy to take your wallet keys at gunpoint.
In terms of @#*%ing up the economy, governments are just as able to trash the Bitcoin economy as they were to trash the gold economy 100 years ago. Using exactly the same methods, too.
The buried gold is hard to access, not portable, and you would have to be damn sure some hobo didn't see you bury it.
1. Don't use brain wallets, unless you really understand security
If you are spending a week in a cold dirty room etc., and especially if some gov got you there, I don't think it matters much how guilty you are or what wealth do you have. They own you.
But if it helps you, think about some other government, not necessarily the US one. Do you think they all do the right thing? Should you or should you not be able to help your starving family in Venezuela?
They really can't all be doing "the right thing" because they have wars between each other. And those are legal in their books. But you probably want to play along however imperfect rules your government sets, that is until you want to escape the country and you don't want it to be your government anymore. Because e.g. you don't feel like killing every Jew you know and that just became the law.
If the US Government, tomorrow, declares a 100% tax on Bitcoin, they can legally posess all of your BTC or... make you a criminal.
See Executive Order 6102 for historical precedent. FDR declared Gold to be illegal and took it from most Americans. At which point, you either gave up your gold, or became a gold smuggler. The US functioned as such until Nixon removed the executive order.
> To date, agents have seized over $200,000 in cash and $25,000 in Bitcoins from Defendant’s operation.
> …It is critical to note, however, that this figure represents a small fraction of the proceeds that were flowing to Defendant. The cash seized came only from funds that Defendant had on hand on May 28, 2014, and from an earlier limited seizure of packages. As discussed above, Defendant’s operation was high-volume and lucrative, and agents do not know where Defendant has hidden the rest of the money.
> While agents made a limited seizure of only $25,000 in Bitcoins from Defendant, it is possible that he has access to significantly greater quantities of this currency.
https://www.deepdotweb.com/2018/01/11/darknet-vendor-dutchki...
> The ex-boyfriend may have earned even more money, but he told the court that he had forgotten the passwords needed to access one of his laptops.
https://www.theguardian.com/uk-news/2018/mar/21/manchester-s...
> The value of their sales was at least £812,000, the court heard, but their profits are likely to have grown exponentially due to the rise in the value of bitcoin over the period. Prosecutors have so far been unable to trace Assaf’s bitcoin.
There are hundreds of other cases in which they didn't seize 100% of the suspect's BTC.
The cases in which they do seize 100% get more media attention, but they are actually in the minority.
You don't need the internet nor the power grid to use bitcoin.
To use bitcoin via the Lightning Network minimally, you need a CPU and a method to transmit data.
CPU: phone
Transmit Data: Bluetooth, QR code/camera.
Electricity for your phone: Cheap emergency solar panel
> To use bitcoin via the Lightning Network minimally, you need a CPU and a method to transmit data.
How do you verify that your opposing party actually has bitcoins to send to you?
Additionally, gold does not have a built in global teleporter. Bitcoin does. I can send basically an unlimited quantity of value to anyone with internet access in minutes with bitcoin; the same is not possible with gold.
If bitcoin is only useful for global remittance and bypassing the long-distance-money-transfer cartels of the world, it is an insanely valuable tool. My estimation is that it is valuable for at least that, and probably several other things as well (e.g. online payments for physical goods that are subject to high chargeback risk, et c).
It's electronic. That is the only advantage, but it's a huge one considering that virtually all (yes, virtually all) money transfers are done electronically today.
"gold is pretty easy to find, not that hard to buy for the average consumer; BTC is anything" ... You can buy BTC with your credit card no KYC needed or you can mine it yourself. Are you gonna start mining gold? If you want to buy to gold you need a trading account, or you order gold and it gets delivered to you, not as simple as buying BTC at all.
"gold is physical in form and securing it is not hard" ... You need a safe and/or insurance, much more complicated then using a password/cold wallet.
"gold at least has some kind of floor value" ... The floor value is really small if you remove the speculative aspect of gold.
Advantages of gold vs. Bitcoin:
- gold is pretty easy to find, not that hard to buy for the average consumer; BTC is anything but
- gold is physical in form and securing it is not hard; BTC is not physical, exchanges get hacked with losses to accounts, in the event of a natural disaster or some event where power generation and internet is lost you lose access to BTC. (Someone can come break in and loot your gold, but people could also do that with your BTC wallet credentials, and if people are doing that you have worse things to worry about)
- gold at least has some kind of floor value, since it does have uses other than a currency store; the same is not true for BTC