We asked the CFO of Kyle Mufti Holdings Inc. to provide conflicted investors a balanced perspective on two merging markets.
- Kyle, thank you for joining us in this week’s interview. We’re looking forward to discussing gold as an investment in 2021 along with the future of Bitcoin in a competing space.
Thank you for inviting me to discuss the topic, I know that a lot of people are interested as it’s something I’m asked often and for good reason. U.S inflation rates have risen to a 13-year high of 5.4% and are growing alongside Canadians 18-year high. Higher food costs, gas prices, and supplemented taxes are pushing people towards a secure asset they can hold amidst the turmoil. As an entrepreneur and investor, I’ve had the pleasure of sitting on both ends of panel discussions debating this very topic.
- How long have you been investing into gold bullion, and at what point did you decide to focus on cryptocurrency along with other digital assets?
I’ve owned physical gold bullion, growing from grams to ounces to kilograms over the past decade, primarily as a hedge against inflation. My roots began with international development which created a clear perspective of economic instability in my teens. Being at the forefront political corruption, laundering, and propaganda it was hardwired into me that owning stable currency was critical. Bullion gave me a hedge against inflation and stability during uncertain times.
Ironically, as “volatile” as Bitcoin is, I entered cryptocurrency for the same reason. In recent months it has been dubbed “digital gold” and has institutions around the world sinking their teeth into it as an alternative to traditional positions on gold. Bitcoin’s decentralized and limited supply of 21 million tokens along with blockchain technology appealed to me. My first involvement with crypto was in 2013.
- With changing regulations and hackers accessing exchanges and wallets, which would you consider safer with regards to security?
From a security and privacy perspective, Bitcoin is arguably much safer to hold. Instead of storing physical bullion in a safe or the redundant act of purchasing speculative gold (as a hedge), you keep your crypto in the blockchain on a ledger which is much harder to compromise with the right measures in place. People who forgot their passwords years earlier or trusted unsecure wallets are not a fair comparison. As for regulations, it’s exciting to see. That’s a ship that sailed in December 2020 without results to speak on yet.
- As a store of value and hedge against inflation, what makes you certain Bitcoin will be the future choice of investors?
Gold has a stronger reputation across the world which as a store of value dates back hundreds of years. Bitcoin on the other hand was launched just over a decade ago with rapid volatility amidst institutional accumulation. Regardless of this, Bitcoin’s growth continues due to the opportunity at hand in this early adoption phase with impressive upside characteristics.
Show me another hedge-worthy investment that has a year-over-year percentage of 308% in 2021 while under the scrutiny and uncertainty of politicians worldwide. Still, Bitcoin continues to gain institutional adoption. It offers better liquidity, a guaranteed limit of circulating supply, and actual utility value unlike gold. There is tremendous baseline value for Bitcoin that solves for issues with our banking structure whilst ushering in new technologies to the blockchain.
- Any final thoughts on the battle between gold and Bitcoin?
I see a $100,000 Bitcoin in the near future. This is closely correlated with regulations along with government and institutional adoption. I believe for the next 10 to 15 years, Bitcoin will compliment portfolios with an additional hedge and greater upside value. Gold holdings will remain but with reduced budgets sharing the light with blockchain counterparts. In my opinion the long-term outcome remains imminent – It is not if gold will be replaced, but rather, when.
If you are doomsday prepper concerned with an apocalyptic event that wipes out electricity and the financial system as we know it, physical gold bullion is for you. However, if you’re embracing a changing world with an alternative store of value as both a hedge and sound investment, Bitcoin will be the opportunity of the century.