share cafe logo  

Bitcoin No Replacement For Gold

Worried about the sustainability of mainstream financial markets, and believing that huge asset price volatility lies ahead, many investors have flocked to bitcoin and other cryptocurrencies.

However, as the recent bout of selling hit equity markets around the world, so too was there selling pressure on Bitcoin and the rest of the crypto space.

Whilst there are many attractive elements to cryptocurrencies - using it as a safe and un-volatile store of value does not appear to be one of these elements.

There is, however, one asset that has weathered pretty much every major financial crisis of the past few hundred years with its value intact.

Gold, the original refuge of nervous investors and government fearing conspiracy theorists, is continuing on its gradual, multi-century, appreciation in price.

Better still, whenever all other assets seem to be depreciating, gold does not lose its shine.

One of the reasons gold has been able to maintain its value throughout history is due to its rarity on the surface of the earth. Scientific research suggests that on the formation of the earth, most of the world's gold was taken towards the earth's core, along with other heavy metals. The gold that is mined today most likely arrived through later asteroid and meteor showers.

According to legendary investor Warren Buffett, all the gold mined on earth would fit into a 20 meter cube - equivalent to less than an ounce of gold per person. Whilst this amount will increase, as more gold is mined, there are increasingly smaller amounts of gold left in the ground.

"More than half of [mined gold] has been extracted in the past 50 years. Now the world's richest deposits are fast being depleted, and new discoveries are rare. Gone are the hundred-mile-long gold reefs in South Africa or cherry-size nuggets in California. Most of the gold left to mine exists as traces buried in remote and fragile corners of the globe." According to Brook Larmer, from National Geographic.

One place where gold discoveries are still being made is West Africa. In Côte d'Ivoire and Burkina Faso alone, more than 80 million ounces of gold have been discovered in the past few decades.

Over 2.5 million of these ounces were discovered by a team from Orbis gold. The discoveries were a boon for the small ASX-listed explorer, leading to its take-over by Canadian miner SEMAFO for around $AU180 Million.

Now, the team behind Orbis' exploration is back in West Africa. They are launching a new exploration company and seeking and ASX listing.

The company, Mako Gold, already has a portfolio of three highly prospective projects in Côte d'Ivoire and Burkina Faso. They have also received a firm commitment of a $2 million investment from ASX miner Resolute Mining (RSG.ASX) as part of the IPO.

To view the Prospectus for Mako Gold, click here. If you have any questions, please feel free to contact an OzFinancial advisor on (03) 8080 5795 or email admin@ozfinancial.com.au

View More Articles By Traders Circle

TradersCircle is one of Australia's leading stock market education firms, and runs one of the country's busiest options trading desks. Learn more at www.traderscircle.com.au.



What are the current opportunities and key risks?

More video   


 › Australian Listed Real Estate Tables
 › Market At Midday On Monday
 › Self Diagnosing Using Google Might Not Just Be For Hypochondriacs
 › Listen To This!
 › Has Medicine Only Just Begun?
 › What's Your Coffee Telling You?
 › CCP - Morgans rates the stock as Upgrade to Add from Hold
 › TAH - Credit Suisse rates the stock as Outperform
 › MHJ - Macquarie rates the stock as Outperform
 › Stronger USD Keeps Heat On Gold, Metals
 › Oil Rallies As OPEC Confirms Modest Output Hikes
 › Shares In Countdown To June 30
 › Diary: Local Jobs, EU Summit, US Housing
 › ASX Outshines Wall St Over The Week
More ShareCafe   


Delivered free to your inbox before the market opens each trading day. Sign up below +