Bitcoins made news when their value increased dramatically in April 2013. Influential events such as Cypriot banking controls where many uninsured accounts were lost, greatly impacted the general public's awareness of the mishaps within the banking industry. Terry Sacka recently addressed investor's questions surrounding the wealth transfer effect where people are moving from fiat currencies to alternate means of exchange and if Bitcoins are comparable investments to gold and silver.
PRLog - Nov. 30, 2013 - JUPITER, Fla. -- In April 2003, Bitcoins increased in value sharply to a record high of $266. This digital currency is being used increasingly all over the world and has attracted many new investors because what makes it different from conventional money is that it is decentralized. No single institution controls the bitcoin network and this structure seems to put people at ease since banking institutions cannot control their money.
Back when Bitcoins were priced near $30 in March 2013, it was announced that Cyprus was getting a $10 billion bailout from the International Monetary Fund and the European Central Bank. At that time, Bloomberg Businessweek published an article titled “Fleeing the Euro for Bitcoins” where it was suggested that the bitcoin was an "app for avoiding the banking system." As it's awareness increased the price moved quickly into the $40 range and it wasn't long before it broke through the $50 level. The wealth transfer effect that has been seen traditionally from paper currencies into gold and silver was now taking effect in the electronic world of the bitcoin marketplace.
Since then, several investors and entrepreneurs have spoken out either for or against the movement. Roger Ver spoke with CoinDesk at the Bitcoin conference in May addressing the possible risks in the technical stability of the Bitcoin network saying,“There is a risk of that,” Ver acknowledged. “But as every day goes by that there hasn’t been a major catastrophe, [the risks] are lower and lower.”
Just as the price rose sharply to $266 it has also dropped sharply clearly expressing the volatility and risks associated with a virtual currency. One of the first and historically most popular bitcoin exchanges, Mt. Gox (an acronym for “Magic The Gathering Online eXchange”) has experienced hacking attacks and has also been drawing the ire of regulators. The exchange has in the past suspended USD withdrawals (although resuming them two weeks later) due to these issues. The event that has truly shaken the confidence of bitcoin investors was when the US government seized $2.9m from the exchange. Mt. Gox is also involved in a bitter legal battle with Coinlab, a bitcoin incubator.
Terry Sacka is a financial analyst and founder of Cornerstone Asset Metals in Jupiter, Florida. He advises investors on how to use physical assets such as gold and silver for diversification and to hedge against inflation. Regarding the wealth transfer effect with bitcoins his response was, "They say bit coins are better because they are private. In reality bit coins are digital, numbers in the cosmos, really do you trust the digital world, all they have to do is turn it OFF!"
His website features interesting videos providing historical insight into the power of gold and silver. He is also a regular guest on "The Wealth Transfer Show" with Charles Vance airing on the Christian Television Network, where he speaks about gold and silver from a biblical perspective being "God's money." At the time the bitcoin began its historical rise in April 2013, he appeared afterward on the show on May 23rd, 2013 to discuss the importance of owning physical hard assets and how the current environment of manipulation will soon end.
http://www.youtube.com/watch?v=dHsa7geMDnI
He went on to say, "Gold and silver have and always will be true money. Since the days of Lydia in 600 B.C. up to today, gold and silver have always maintained wealth as a storage of value over time. Besides you can put your hands on it, bury it if desired and give it to your children and your children’s children."
He also discusses how some of the best long-term investment accounts, such as IRA's and 401k's, allow for precious metals such as gold and silver - not bitcoins.
About Terry Sacka
Terry is a financial analyst and accredited asset management specialist (AAMS) at Cornerstone Asset Metals, a private bullion dealer located in Jupiter Florida. The company enables investors, both large and small, to use metals such as gold, silver, platinum and palladium as an effective hedge for their retirement accounts against inflation. The company mission is to put people back in charge of their wealth through tangible assets that have been used as a medium for exchange since the dawn of civilization.
For more information visit the company website at http://www.cornerstoneassetmetals.com
Cornerstone Asset Metals 601 Heritage Drive, Suite 104 Jupiter, FL 33458 (888) 747-3309
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Terry Sacka Addresses the Wealth Transfer Effect of Bitcoins Versus Gold and Silver
November 30, 2013 at 21:12 PM EST
