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Gold is a precious metal used by mankind as a medium of exchange for millennia. It is also useful in technology and manufacturing, and is appreciated for its beauty in the form of jewelry, art and keepsakes. Physical Gold is widely regarded as a sound long-term investment and a hedge against market volatility. Bitcoin, on the other hand, is a coded, crowdsourced currency that did not exist until 2009.

Bitcoin is the world’s first decentralized digital currency. This novel system for virtual money was first proposed by software developer Satoshi Nakamoto in 2008 and made available to the public in 2009. This system allows members of the bitcoin community to mine new bitcoins using open-source software to solve complex mathematical equations. The total supply of bitcoins that can ever be mined is capped at 21 million. A bitcoin is represented by the record of its transactions between different addresses. Addresses consist of randomly generated sequences of letters and numbers. Users purchase bitcoin by using another sequence in the form of a private key that is kept secret. Miners must verify all bitcoin transactions.

Bitcoins provide users with a unique trading experience. Unlike the American dollar and British pound, bitcoin, also referred to as cryptocurrency, is not regulated by a single central bank. In theory, this means the virtual currency is decentralized, democratized and can be accepted anywhere in the world. It also means that bitcoins are unregulated, which can open the door to corruption.

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“You can’t eat gold.” The enemies of gold often unleash this little zinger, as if it dismisses the idea of owning gold and indeed the whole gold standard. It is a fact, you cannot eat gold. However, it dismisses nothing.

Some argue that this is exactly why gold is such an interesting investment and asset class. Equities can be eaten by poor management and interest rate fluctuations, but gold will remain where it is, untouched by market turbulence. Gold’s inherent stability allow it to serve as an anchor in many situations, facilitating low volatility in uncertain market environments.

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Long seen as the investment choice of the cranky and the fearful, the metal yields nothing; as Warren Buffett has said, it just “looks at you.” This year has been especially lackluster for gold. Its price has slumped 8%, to about $1,200 an ounce, and is off more than 35% from its high of $1,900 in 2011. Adding insult to injury, Vanguard will soon rechristen the largest gold-oriented U.S. mutual fund and shift its focus away from the metal.

But this out-of-favor asset class now deserves a place in investment portfolios. Compared with stocks and other financial assets, gold looks inexpensive. More important, inflation is starting to pick up in the U.S. and in much of the world as central banks shrink their enormous balance sheets. And gold has represented a good defense against inflation eroding the value of a stock or bond portfolio. Over time, it has held its value against the dollar. Gold was $20.67 an ounce 100 years ago and that bought a good men’s suit. At $1,200 an ounce, the same is true today.

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The gold markets were struck by the discovery of gold deposits in 1849. Some would argue the markets have never recovered from this turbulent period.

The wealth that resulted was distributed widely because of reduced migration costs and low barriers to entry. While gold mining itself was unprofitable for most diggers and mine owners, some people made large fortunes, and the merchants and transportation facilities made large profits. The resulting increase in the world’s gold supply stimulated global trade and investment.

Historians have written extensively about the migration, trade, colonization and environmental history associated with gold rushes. Gold rushes were typically marked by a general buoyant feeling of a “free for all” in income mobility, in which any single individual might become abundantly wealthy almost instantly, as expressed in the California Dream. Gold rushes helped spur a huge immigration that often led to permanent settlement of new regions.

Activities propelled by gold rushes define significant aspects of the culture of the Australian and North American frontiers. At a time when the world’s money supply was based on gold, the newly mined gold provided economic stimulus far beyond the gold fields. Gold rushes extend as far back to the Roman Empire, whose gold mining was described by Abominus and Pliny the Elder, and probably further back to Ancient Egypt.

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Gold has a long history in China and has been coveted as a precious item for thousands of years. Gold mining in the People’s Republic of China has made that country the world’s largest gold producer by far with 463.7 tonnes in 2016.

For the year 2007, gold output rose 12% from 2006 to 276 tonnes (9,700,000 oz; 304 short tons) to become the world’s largest for the first time by overtaking South Africa, which produced 272 tonnes (9,600,000 oz; 300 short tons).

South Africa had until then been the largest for 101 years straight since 1905. The major reasons for this change in position had been due to South African production falling by 50% in the past decade as production costs there have risen, more stringent safety regulations have been implemented, and existing mines have become depleted. On the other hand, as of 2014 gold output in China had more than doubled since year 2000.

In recent years, China’s gold mining industry has received increased foreign and domestic investment, and project numbers have increased as more discoveries have been found. China produced nearly 300 tonnes of gold in 2008. It is also the only country in the top three where production rose in 2008. In 2014, production had increased to 450 tonnes and it was expected to reach 490 in 2015. The second-largest producer, Australia, mined 274 tonnes in the same year, followed by Russia with 247 tonnes. South Africa is now in the 6th position with 152 tonnes.

Types of Gold in Jewelry

If you have ever been shopping for gold jewelry, you must have observed that several options exist, and are all referred to as gold despite their distinct differences in appearance.

Gold jewelry is not pure gold. It is an alloy; a mixture of metals. Gold jewelry can be alloyed with silver, copper, zinc, palladium, and nickel to create different gold colors. The most common gold colors are: yellow, white, rose, and green.

Yellow gold is made by mixing pure gold with silver, copper, and zinc. It is the purest color, the most hypo-allergenic, and requires the least maintenance of all the gold colors.

White gold is made of gold and platinum (or palladium). White gold can also be made of gold, palladium, nickel and zinc. White gold is more durable and scratch-resistant than yellow gold. It is also more affordable than both yellow gold and platinum.

Rose gold (or pink gold)  is alloyed with gold, copper, and silver. Rose gold is more affordable than the other gold colors because it uses the inexpensive copper for its rose color. Due to its copper content, rose gold is more durable than yellow or white gold.

Green gold (or Electrum) is mixed with gold, silver, and sometimes copper. Silver is what gives the gold alloy the green nuance.

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Gold has many uses in the modern economy, which stabilizes its value in international markets.

Many of the applications of gold in the industry have increased significantly over the last three decades as goods produced have become more complex and require more reliable materials. The increase in demand, limited supply, and lack of substitutes make gold an invaluable precious metal of the future.

Astronauts have a thin film of gold on the visor of their helmets that reflects the solar radiation encountered in space. Similarly, gold is used in glass to reflect solar radiation outward, allowing the building to remain cool in the summer. The gold treated glass also reflects the internal heat of the building allowing it to stay warm in the winter. Aesthetically, adding gold to the glass when it is cooled will produce a red color.

NASA needs to build space vehicles with the most dependable parts known to man. For this reason, gold is used in many applications involved in space travel. The circuitry of the space vehicle is gold because the precious metal is a highly dependable conductor of electricity. Many external parts are covered in a gold-coated film. The film stabilizes the temperature inside the space vehicle and reflects the radiation in space. Gold is also used as a lubricant between parts because traditional lubricants that work on Earth would be broken down by radiation located in outer space.

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Gold has a long and important history in human culture. Ever since trade and barter existed, gold was sought after for its desirable physical properties.

The Egyptians also produced the first known currency exchange ratio which mandated the correct ratio of gold to silver: one piece of gold is equal to two and a half parts of silver. This is also the first recorded measurement of the lower value of silver in comparison to gold.

The Egyptians also produced gold maps – some of which survive to this day. These gold maps described where to find gold mines and various gold deposits around the Egyptian kingdom.

As much as the Egyptians loved gold, they never used it as a bartering tool. Instead, most Egyptians used agricultural products like barley as a de-facto form of money. The first known civilization to use gold as a form of currency was the Kingdom of Lydia, an ancient civilization centered in western Turkey.