After the bitcoin boom: hard lessons for cryptocurrency investors

[specuvestor]

Strictly speaking, gold has no intrinsic value as an asset class.

I admit, I don't know what striktly speaking "intrinsic value" means, but history has shown that gold get accepted as a means of payment even without the blessing of Governments or Central Banks, and that's enough intrinsic value for me

but i am not sure why there is a need to add a layer of complexity on top of holding gold.

With layer of complexity you mean probably blockchain.
Firstly, as was already said in this thread somewhere, titles of ownership on the blockchain are more difficult to be falsified than on paper or on traditional electronic form.
So, security.

Secondly, you need this extra layer of complexity in order to be able to use 0,05 grams of your gold for buying a cappuccino.
Currently you'll probably sell 1 ounce of gold (selling fees), keep 1200 $ in your bank account and spend 2 $ for the cappuccino, after a selling procedure which can become laborious.
That's why nobody uses gold (or silver) to buy a cappuccino. It's too laborious and expensive.

In order to be able to buy a cappuccino with your precious metals you need them on the blockchain plus some kind of device which is able to convert in real time your precious metals account on the blockchain in the currency accepted by the vendor.

A crypto backed by Gold? We are probably going full circle back to the Bretton Woods system.

Not necessarily.
Bretton Woods was just one way of establishing a gold based monetary system.
I think the conditions that allowed the Bretton Woods system to work are no more there, but I must admit, I know this system only through your Wiki-link

I'd put it this way: with a gold backed crypto we would return to a monetary system in which our currency's value is the value given to gold and silver within our society and not the one established by Governments and Banks

First of all security hype for blockchain is just hype. When will the next bitcoin exchange be hacked? This year already hacked 2 times liao rite? Millions lost!! 

Will my gold backed crypto get hacked? How will i prove the gold is mine? Paper certificate? But wait, its all anonymous so how?? If my ownership got transferred overseas, sure theres a trail, but how am i gonna get it back? Oh wait, there is no international gov to help, since its designed to have no gov control!

There is already value in gold dictated by its value and available in different currencies. No gov has control over this value, its a traded commodity governed by demand and supply. No government can dictate value of a commonly and internationally traded commodity like gold. If u go buy a piece of physical gold from uob, u pay the price in sgd. Sg gov cannot suka suka declare gold value is double in sg the next day, there is international market price for it, international society bro.

Thank u very much, but i prefer my ownership of gold to be registered with a gov regulated bank or in a safe deposit box or under my pillow. And if i need to spend my gold, i have this thing called SGD. Better yet, my SGD can be stored in my online account and i can spend it with my card. If u try to steal my gold or Money in my wallet or money in my bank, rest assured the police will come after u. If the bank wants to adopt blockchain tech to store any gold i register with them, i dont mind, so long is regulated by them and gov. But why would they want to do that? They already have secure server networks processing gold transactions fine with redundancy backups and very possibly paper records.


Go and read up on how the blockchain is implemented and read up on how a traditional non distributed database is implemented, then u will realise its mostly all hype.

Lehman was approved by MAS with blessing. After the devastation, MAS appear to "humour" various investors and acted like Pontius Pilate.

Blatant truth is any man-made system is NEVER bullet (hack) proof. Even with physical security eg safe box (anybody remembered how a bank (DBS) can let a renovation carried with dumping of safe boxes from an existing bank. 

Personally as there is no perfect systems that will last forever, I believe systems like blockchain are precursors as to what is to come in the future. It is all about work in progress. What is best today is inadequate tomorrow?

I think the idea of a decentralised blockchain with a presumably centralised collateral backing is a bit of oxymoron. VBs here know that I differentiate between Cryptocurrencies as a concept and Blockchain as a technology. To understand the merit of decentralised system is to understand the merit of a centralised system and then it's flaw. Then you will realise what flaw decentralisation is trying to address and with it, its own flaws.

Nothing is perfect but key is to optimise and make better mousetraps. And usually it depends on different solutions to different circumstances. But as a concept Cryptocurrency doesn't work