The Bitcoin (BTC) debate against gold is growing this week, as reports reveal that the fake bars fueled a $2.8 billion corruption scam.
As reported by Chinese media Caixin via Nikkei on June 29, a loan agreement between Chinese financial institutions and Wuhan Kingold Jewelry, with gold as collateral, collapsed when it became known that the gold was golden copper.
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Bitcoin holders are „stupid“
According to Caixin, „at least some“ of the gold bars involved were simply copper, which made the lenders seriously out of pocket as a result.
„That has left the lenders holding the remaining 16 billion yuan given in outstanding loans in exchange for the fake bars,“ he reported.
The saga is only the latest to involve fake gold to gobble up high-profile entities. Previously, Cointelegraph reported allegations that gold reserves at major central banks may also be contaminated with other metals.
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For Bitcoin supporters, the problems of gold authentication are a major argument against investing in or owning the precious metal.
A survey by analyst Mati Greenspan revealed that Bitcoin was by far the most popular choice for investment. Forty-two percent of the more than 2,300 respondents selected it, while gold was in second place.
However, for Peter Schiff, the finding says more about the mindset of Bitcoin investors than the integrity of gold.
„This just shows how delusional #Bitcoin enthusiasts are,“ he said on Twitter.
„Given how far Bitcoin is from its record in relation to the Dow Jones or the #gold, they’re still waiting for it to set a new record first. Hope is never a good investment strategy.
BTC cannot be counterfeited
Schiff’s perspective is nothing new, but his well-publicised ups and downs with Bitcoin so far have not convinced his supporters to believe in his displeasure.
Last week, RT presenter Max Keiser stated with 100% certainty that Schiff would make a „big purchase“ once the BTC/USD reached $50,000.
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Summarizing the gold versus Bitcoin debate in light of the Wuhan Kingold scandal, for his part, Parallax Digital CEO Robert Breedlove hinted that the choice would ultimately be obvious to the market.
„Bitcoin is more divisible, durable, portable, recognizable (encompassing verifiability), and scarce than gold. Bitcoin is also cheaper to safeguard and less vulnerable to theft,“ he wrote.
„I wonder which one will decide the free market“