Earlier this week, former Congressman Ron Paul posted a Twitter poll asking his followers to choose between four different assets for a long-term investment, with the stipulation that the bearer would need to keep their money locked up for ten years.
A wealthy person wants to gift you $10,000. You get to choose in which form you’ll take the gift. But there’s a catch: You must keep the gift in the form that you choose, and you can’t touch it for 10 years.
In which form would you take the gift?
— Ron Paul (@RonPaul) December 5, 2017
Paul admitted he was surprised when he saw that a majority of respondents – 54% – selected bitcoin over gold, dollars and a 10-year Treasury bond.
During an interview with the Street, a reporter asked Paul if he was surprised that his followers prefer bitcoin to gold.
Yea a little bit. I was a little bit – of course I wasn’t surprised that only 2% would store it in Federal Reserve notes, nor do they think they should buy Treasury bills. Gold has 36% but bitcoin has 54%…it’s the sort of information that tells me where my viewers are and what they’re thinking. Most of my viewers know how supportive I am of gold, and they know I’m tolerant of digital currencies.
Still, Paul believes cryptocurrencies are an interesting experiment and is generally supportive of their development and increasing popularity. But when asked for his thoughts on where bitcoin might be in ten years, he demurred.
What’s it going to be like in ten years? Nobody knows. But we have a pretty good idea where gold will be. It’s been around a long time and it’s not going away.
Though the market for gold is still much larger than the market for bitcoin, Paul’s interviewer asked if the interest in cryptocurrencies could be one reason for gold’s recent stumbles.
I think we could still be in a phase where gold could take off. It’s just a matter of figuring out when…the fed has created so much money and people have sort of caught on to it like a fever.”
Paul said he doesn’t invest in bitcoin or any other cryptocurrencies, and has no plans to start.
No, I don’t intend to at all. I find it fascinating, but as an investor, no…”
At the interview’s conclusion, Paul explained that digital currencies have helped demonstrate an important principle about government and sound money: When a government loses all credibility and its currency becomes worthless, people will work out an alternative monetary system on their own. Venezuela and Zimbabwe have been perhaps the best examples of this: bitcoin trades at a premium in both countries. And in Venezuela, bitcoin miners risk being prosecuted by the government.
“Take a country like Zimbabwe or Venezuela. They change their attitudes quickly when they get in trouble.”
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