BBI token is quickly becoming a popular investment and is fully backed by gold, representing gold, or is viewed as the same value as gold. In terms of equality, owning BBI token is compared to owning real gold as it is being developed to tokenize on the blockchain. This is structured in such a way to easily conduct digital transactions or trades. Although a complex process, the gold backing BBI token is being stored in a bank-safe deposit box where the token holder can claim the gold they have at any time.
What’s so great about BBI token?
If you’re wondering about the pros and cons of owning BBI token or gold as an investment, how to make quick profits day trading on the commodities market, what influences the price, and how to own gold in your brokerage account, continue reading.
Gold as an Investment
Let’s take a look at gold’s place in our monetary economy, uncovering why it’s valuable and what role gold can play today in investor’s portfolios. Gold has never been more fashionable as an alternative investment, able to weather financial crises and hedge against the inflationary pressures of fiat currency. In fact, investing in gold has some fundamental issues:
- The main problem with gold is that, unlike other commodities such as oil or wheat, it does not get used up or consumed. Once gold is mined, it stays in the world. Oil can be is turned into gas, it can be expanded into a vehicle. Grains are consumed in the language of origin.
- The supply/demand argument that can be made for commodities like oil and grains, etc, doesn’t hold so well for gold. In other words, the supply will only go up over time, even if demand for the metal dries up.
- Gold is stored as precious metal locked away in vaults or turned into jewelry.
We are in an entirely different century now where gold is mostly used in the wire bonding process during chip interfacing to package. Now, imagine how much this chip is produced, from mobile phones, smart TV, and every electronic device we rely on today.
Historically gold has held the fascination of human societies since the beginning of recorded time. Empires and kingdoms were built and destroyed over gold, As societies developed, gold was universally accepted as a satisfactory form of payment. The US dollar was once backed by gold, but the U.S. monetary system abandoned the gold standard during the 1970s.
The reason why the gold standard was eliminated is because it controls the expansion of credit and enforces discipline on lending standards since the amount of credit created is linked to a physical supply of gold.
Investing in Gold
The easiest way to gain exposure to gold is through the BigBoys Industry platform, where you are actually part of the gold mining operation. For as little as a $100 investment, you will have the Bigboys industry team run the whole mining process for you, while you monitor in real-time. Check it out on https://bbi.is.
The most common way to invest in physical gold is through the SPDR’s Gold Shares (NYSE:GLD) ETF, which simply holds gold, gold-mining companies including Barrick Gold (NYSE:ABX), Newmont Mining (NYSE:NEM), Goldcorp (NYSE:GG), and Anglogold Ashanti (NYSE:AU).
Why Has Gold Always Been Valuable?
Let’s look at the fundamentals of trading gold and what types of securities or instruments are commonly used to gain exposure to gold investments. We’ll look at using gold both as a long-term component of a diversified portfolio and as a short-term day trading asset. We’ll look at the benefits of gold, but also examine the risks and pitfalls, and see if it lives up to the “gold standard”.
Since ancient civilization, from the Egyptians to the Inca, gold has held a special place of actual and symbolic value for humanity.
- Gold has moreover been used as money for exchange, as a store of value, and as valuable jewelry and other artifacts.
- Gold’s value is ultimately a social construction: it is valuable because we all agree it has been and will be in the future.
- Still, gold’s lustrous and metallic qualities, its relative scarcity, and the difficulty of extraction have only added to the perception of gold as a valuable commodity.
Gold, Psychology, and Society
If the modern paper-money economy were to collapse, gold may not have immediate use as panic sets in and people fight for their basic needs—but it will eventually. Here’s why:
- Gold Provides the Comfort of Sustainability. Gold is the logical choice for this exchange. If disaster strikes where paper money and the system that supports it no longer exists, we will revert to gold. Arguably, gold is one of the only substances on earth with all of the qualities for the job, including sustainability.
- A Gold Brooch Can Become a Wagyu Steak. A chunk of gold may have no immediate physical value to the person holding it; they cannot eat or drink it, but if it was turned into gold and then into a digital asset tokenized into a system of exchange for goods, known as BBI token, then that BBI token would instantly assume a value. What was originally inedible could become a wagyu steak dinner, for example.
Because others believe that gold has value, you do too; and because they think that you value gold, others value it too. Gold is the metal we fall back on when other forms of currency don’t work, which means that gold will always have value in tough as well as good times. Now we tokenize gold into digital assets, creating a crypto token representing gold that is mined from BigBoys Industry, which also means that the BBI token will always have value as gold.
Today, gold is sought after, not just for investment purposes and to make jewelry, but it is also used in the manufacturing of certain electronic and medical devices. Gold (as of August 2020) was over $2,000 per ounce and up considerably from levels under $100 seen 50 years ago. What factors drive the price of this precious metal higher over time?
- Investors have long been enamored by gold and the price of the metal has increased substantially over the past 50 years.
- Like most commodities supply and demand is incredibly important, but gold also retains additional value.
- Government vaults and central banks comprise one important source of demand for the metal.
- Investment demand, especially from large ETFs, is another factor underlying the price of gold.
- Gold sometimes moves opposite of the U.S. dollar because the metal is dollar-denominated, making it a hedge against inflation.
- Supplies of gold are primarily driven by mining production, which has leveled off since 2016.
Central Bank Reserves
Central banks hold paper currencies and gold in reserve. As the central banks diversify their monetary reserves away from the paper currencies that they’ve accumulated and into gold, the price of gold typically rises. Many of the nations have reserves that are composed primarily of gold.
Worldwide Jewelry and Industrial Demand
In 2019, jewelry accounted for approximately half of the gold demand which totaled more than 4,400 tonnes, according to the World Gold Council. India, China, and the United States are large consumers of gold for jewelry in terms of volume. Another 7.5% of demand is attributed to technology and industrial uses for gold, where it is used in the manufacturing of medical devices like stents and precision electronics like GPS units.
Therefore, gold prices can be affected by the basic theory of supply and demand; as demand for consumer goods such as jewelry and electronics increases, the cost of gold can rise
During times of economic uncertainty as seen during the recession, more people turn to invest in gold because of its enduring value. Gold is often considered a “safe haven” for investors during turbulent times. When the expected or actual returns on bonds, equities, and real estate fall, the interest in gold investing can increase, driving up its price. Gold can be used as a hedge to protect against economic events like currency devaluation or inflation. In addition, gold is viewed as providing protection during periods of political instability as well.
Now you have the chance to easily own gold through BBI token and the BigBoys Industry, a crypto token that is backed by real gold.