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Comment by csomar | Hacker News Reader

The reason is that life is not really that simple. People pick people/assets/things based on reputation and popularity and not technical or practical merit.

Gold is used as a store of value despite the fact that it is 1. volatile 2. hard to store 3. hard to buy/sell and 4. hard to transport.

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Gold at least has some unique purposes besides a store of value. Over half of it is used for jewelry and commercial reasons, so at worst it can be considered an over-speculated commodity. Bitcoin literally has nothing going for it besides being the current market leader.

If the International perception of gold being valuable disappeared overnight (which... yeah, won't happen unless someone discovers legit alchemy magic) the difference between losing 90% of your value or 100% if it had no use outside of the speculation shouldn't be influencing almost anyones decision in what to invest in. All the other parameters (volatility, profitability, etc) are way more important than if you are completely bankrupt or completely fucked if the market implodes.

My point is that gold can never lose 90% of its value because the majority of it is already used in luxury items and electronics. At worst, the total value of gold can only drop by the current amount that is being held in reserve or as investments.

Price is set at the margin. If half the demand for gold evaporated the price for gold would likely drop a lot more than 50%, probably more than 90%. When demand for gasoline went up by 2%, the price doubled.

>the current amount that is being held in reserve or as investments

--which is almost all of the gold in the world.

Hardly anyone uses gold as a storage of value.

> Hardly anyone uses gold as a storage of value

https://en.wikipedia.org/wiki/Gold_reserve#Officially_report...

I meant individuals rarely keep gold as a store of value.

> I meant individuals rarely keep gold as a store of value.

I think individuals with an actual portfolio of investments will hold gold or have some exposure to gold.

Also, you wouldn't expect gold to be widely held when you consider things like Executive Order 6102: https://en.wikipedia.org/wiki/Executive_Order_6102

Basically, the US government forced everyone to sell their gold in 1933. US citizens only regained the right to hold gold in 1974.

Governments are going to find it much harder to enforce such an order when it comes to cryptocurrencies.

It is not rare in South Asia.

Wrong, its not that volitile, its very easy to store, and its very easy to buy the physical coin...local or online and the paper version via some fund of some sort. Also easy to store for average Joe as he isn't buying kilos and instead is buying ounces.

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