Uganda Announces Massive Untapped Gold Deposit: How Does This Affect Bitcoin?
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Over the past few years, Bitcoin has been touted as the “digital gold” because of its capped 21 million supply property, which—in theory—makes it a non-inflationary asset and a solid Store of Value (SoV).
Gold is without a doubt the benchmark for Store of Value due to its limited supply and unwavering track record that goes back millennia. However, with a Ugandan government official recently declaring that the country currently sits on 31 million metric tons of gold ore, the precious metal’s undisputed reign as a Store of Value might be at stake. That said, a fall in gold paves the way for a new king of SoV, Bitcoin.
Michael Saylor on Gold vs. Bitcoin Argument
Reacting to the recent discovery of massive gold ore deposits in Uganda, MicroStrategy CEO Michael Saylor posted a video about the discovery on Twitter, which noted the deposits could net 320,158 metric tons of refined gold “valued at $12.8 trillion.” In a previous tweet, Saylor noted: “#Gold is plentiful. #Bitcoin is scarce,” adding:
“Every commodity in the world has looked good in a hyperinflationary environment, but the dirty secret is you can make more oil, you can make more silver, you can make more gold […] Bitcoin’s the only thing that looks like a commodity that is scarce and capped.”
The comments from the Ugandan government official have sparked confusion in the discussion space, with estimates placing that the 320,158 metric tons of refined gold that could be produced from the newly discovered deposits in the northeastern corner of the country would exceed the 200,000 metric tons in refined gold currently existing (all the gold in the world). Some have gone as far as suggesting the Ugandan government official might have confused metric tons with ounces.
Regardless, Saylor’s point stands as more gold can always be mined in Uganda or anywhere gold can be mined, especially as exploration and mining technology advances. This possibility makes Bitcoin an attractive alternative, given the 21 million supply is fixed and more Bitcoins can never be mined after that.
Commenting on the discovery, head of research at Blockchain.com Garrick Hileman noted:
“The Ugandan find underscores why the approximately 200 million holders of Bitcoin believe that ‘digital gold’ — Bitcoin — is superior to the actual gold in terms of its scarcity and reliability as a Store of Value in the decades to come.”
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