• As 10-year returns fall, one Bitcoin now buys 0.6 kilograms of gold

  • Bitcoin (BTC) supporters continue to mock gold bugs as the precious metal’s 10-year returns turn negative.

    According to new data, XAU/USD traded 3.7 percent lower on August 10 than it did on the same day in 2011.

    Gold has failed to impress in any timeframe.

    It’s been a rough week for gold and its investors, with a sharp drop on Monday compounding losses that have characterized much of 2021.

    Starting the year at $1,941, XAU/USD was down to $1,729 at the time of writing, representing a 10.9 percent year-to-date loss.

    Previously, the longer-term performance had saved gold from humiliation; however, as of this month, even a ten-year hodl is a dubious investment. On August 1, 2011, the precious metal was trading at $1,830, a 5.8 percent increase.

    Meanwhile, in terms of dollar gains, Bitcoin has vastly outperformed not only gold, but every major commodity, and shows no signs of reversing to give gold any kind of competitive advantage.

    “A single bitcoin is now worth the equivalent of 21 ounces of gold. Last week, the trading platform FTX summarized the word “poetic.”

    Gold appears even weaker when priced in BTC, at 0.038 BTC per ounce as of Tuesday. Its all-time lows of 0.02746 BTC occurred in mid-April, as BTC/USD reached current all-time highs of $64,500.

    In other words, 1 BTC now buys nearly 600 grams of gold.

    “This isn’t digital gold!”

    Unsurprisingly, members of the gold industry, including Schiff Gold CEO Peter Schiff, were among the few voices publicly championing the precious metal.

    The infamous Bitcoin skeptic, blaming gold’s performance on macro market factors, maintained that despite its success, Bitcoin could never match it.

    “Bitcoin rising as gold falls do not imply that it has replaced gold as an inflation hedge,” he argued this week.

    “Gold is falling as traders mistakenly believe that by tapering QE and raising interest rates, the Fed will be able to successfully combat inflation. Bitcoin does not trade in the same way as gold because it is not digital gold!”

    His viewpoint contrasts with that of an increasing number of non-crypto voices this year, including investment mogul Ray Dalio and Federal Reserve Chair Jerome Powell. However, the latter recently stated that he would still prefer gold to BTC.

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