Bitcoin advocate Robert Breedlove argues that BTC threatens gold’s value by driving down energy costs. Cheaper energy would enable scientists to produce gold in laboratories at costs below its market price, challenging gold’s scarcity and appeal as a store of value.
“Gold can already be artificially produced, but not yet at a cost below its market price,” Breedlove said.
He argues that Bitcoin mining drives investment in cheaper energy as miners compete to reduce electricity costs. Over time, these investments help lower energy prices and reduce the cost of laboratory-produced gold. However, if producing gold becomes cheaper than mining it, gold will lose its scarcity premium and appeal as a store of value.
Yesterday, Marathon Fusion reported progress in nuclear transmutation, a process that converts one element into another. The company claims its technology converts mercury into stable gold at a rate 10 times higher than a previous record set by CERN. It also reports developing powerful isotope-enrichment technology and building a fusion reactor in San Francisco.
However, laboratory gold production does not guarantee commercial profitability. Energy, equipment, and production costs must fall below the market value of the gold produced for the process to become economically viable.
Joe Burnett, vice president of Bitcoin strategy, also argues that technological advances threaten gold’s scarcity by making its supply easier to expand.
“The problem with gold is that once a supply vulnerability is discovered, you can’t patch the bug,” Burnett said.
Bitcoin, by contrast, has a predetermined supply limit of 21 million coins. Changing its rules requires sufficient support from network participants.
Burnett also addressed concerns about quantum computing, arguing that Bitcoin’s security can be upgraded to counter future threats. The upgrades require developers and network participants to reach agreement and adopt the necessary changes.
Michael Saylor, executive chairman of Strategy, previously argued that Bitcoin and gold represent fundamentally different investment propositions.
In November 2020, he wrote that as Bitcoin emerged as a major competitor, gold stood to become the first asset to lose out. Saylor’s argument centered on Bitcoin attracting investors who traditionally rely on gold to preserve wealth.
Breedlove takes a different approach. His argument centers on Bitcoin-driven energy innovation undermining gold’s position by lowering the cost of producing the metal, rather than simply drawing investors away from it.
The prospect of Bitcoin-driven energy improvements making laboratory-produced gold cheaper than market-priced gold remains hypothetical. Marathon Fusion’s claims hinge on commercial viability, which depends on energy prices, equipment costs, and the efficiency of gold production at scale.
Ultimately, technological advances could weaken gold’s natural scarcity while Bitcoin’s fixed supply strengthens its appeal to investors.
