Cryptocurrencies were once seen as a niche idea, but they are now part of a broader investment debate: can digital assets eventually compete with traditional safe havens like gold and silver?
For generations, precious metals have been trusted stores of value during uncertainty. Crypto, though relatively new, has gained attention due to rapid growth, wider adoption, and the appeal of decentralised systems. This shift has prompted investors to reconsider what qualifies as a safe asset in a digital era.
The discussion ultimately centres on how value is defined. Gold and silver draw strength from history, physical scarcity, and long-standing trust. Cryptocurrencies, by contrast, are built on digital scarcity and seamless global transferability.
Raj Karkara, COO of ZebPay, argues that the comparison should not be viewed as a rivalry. He explains that crypto and precious metals serve different purposes within portfolios. In his view, cryptocurrencies were created not to replace gold or silver, but to introduce decentralised digital assets that enable trustless transactions and diversification.
He highlights Bitcoin’s capped supply of 21 million coins as a key design feature supporting its scarcity. Rather than replacing traditional assets, Karkara suggests crypto represents a new way of storing and transferring value in an increasingly digital economy.
Volatility remains one of crypto’s biggest challenges. Digital assets often experience sharp price swings, while gold and silver are typically more stable. Karkara notes that metals benefit from centuries of regulation and deep participation, which contribute to their steadiness. He adds, however, that volatility is common for emerging asset classes and may decline as adoption and regulatory clarity increase.
Growing crypto participation in countries like India, along with developments in markets such as the US and UAE, indicates that digital assets are gradually moving into mainstream finance.
Bitcoin is frequently described as “digital gold” because of its limited supply, leading some to view it as a hedge against inflation. Karkara advises restraint, pointing out that cryptocurrencies lack the long track record of precious metals across multiple economic cycles. He considers crypto an emerging option that can sit alongside traditional inflation-resistant assets rather than directly mirror them.
The role of regulation
Policy and regulation will significantly influence crypto’s credibility. Clear rules often reduce uncertainty and attract institutional investors. Karkara emphasises that well-defined frameworks, including in India, could improve confidence without framing crypto as a substitute for gold or silver.
Complementary roles
Accessibility and liquidity for crypto investments continue to improve, partly due to the rise of products like exchange-traded funds in global markets. Still, Karkara stresses that investors should recognise crypto’s higher risk profile and adopt disciplined allocation strategies.
He concludes that cryptocurrencies are best considered as a complement, not a replacement, within diversified portfolios.
As finance becomes more digital, the relationship between crypto and precious metals may be less about competition and more about coexistence. Gold and silver are likely to retain their reputation for stability, while crypto develops as a technology-driven, growth-oriented asset. For investors, the key may lie in balancing both, blending established safeguards with emerging innovations.
