Gold has been a store of value in recessions and financial crises, but over the last decade, bitcoin has started to steal its thunder. Sometimes even being dubbed “digital gold”, the cryptocurrency has echoed gold’s epic booms and busts except with much more volatility.
While most people have held gold in the form of jewelry or in various electronic devices, bitcoin remains a physically intangible asset that is stored on digital ledgers and secured with cryptographic keys.
Using price data from TradingView, this graphic compares the two assets by showing how much gold is equivalent to one bitcoin, while also visualizing bitcoin’s market capitalization and 2021 gold production in the form of gold cubes.
With a single bitcoin worth around $22,600 at the time of the visualization, this is equivalent to a small cube of gold just over 20 cm3, with each side measuring around 2.7 centimeters, or just over one inch.
This tiny gold cube that fits in the palm of a hand is not only worth $22,600, but also weighs an impressive 12.6 troy ounces (just under 0.8 lbs or around 357 grams) thanks to gold’s extremely high density of 19.32 g/cm3.
When converting the value of bitcoin’s entire market capitalization of $432.7 billion to physical gold, the gold cube would be 7.3 m (23.9 ft), taller than four people stacked on top of each other. To put this in perspective, we also visualized the amount of gold mined in 2021, which was around $204.9 billion worth, weighing in at 3,560.7 tonnes.
In its short 13-year lifespan bitcoin has grown tremendously to reach nearly half a trillion in market capitalization currently, but compared to gold it’s still small.
Just 2021’s gold production was worth nearly half of bitcoin’s entire market cap, and with gold’s market cap estimated to be around $11.7 trillion, it’s more than 20 times larger than that of the cryptocurrency’s.
While at first this might seem like a drawback for bitcoin, its small market cap has partially enabled its stratospheric price increases in bull runs.
Due to bitcoin’s smaller market cap, money flowing into bitcoin results in a larger percentage increase than if the same amount of money flowed into gold, giving the cryptocurrency more potential upside but also much more volatility as money moves in and out.
While gold has long been a safe haven asset or store of value for investors, in 2021 bitcoin and other cryptocurrencies got all the attention as the orange coin’s price surged by 59% and reached an all-time high of $69,000. However, since the start of 2022, bitcoin’s price has fallen by 49%, and is more than 65% from its all-time high of last year.
As a result of all this volatility, bitcoin is now below any price traded in 2021, meaning anyone who bought bitcoin in 2021 and held on is now down on their investment.
Meanwhile, gold fell by 4% in 2021, and is down another 2% in 2022, so while gold buyers of 2021 are also down on their investment, they’ve had a much smoother ride with smaller losses along the way.
Whatever lies ahead for these two unique assets, in terms of market cap size, returns, and volatility, the digital gold that is bitcoin has a long way to go before it catches up to the real thing.
(This article first appeared in the Visual Capitalist Elements)