Gold and Bitcoin break inflation-adjusted all-time highs, but it took gold 40 years

Gold enthusiast and Bitcoin skeptic Peter Schiff was just 17 years old when gold prices hit all-time highs. Meanwhile, Bitcoin (BTC), a much younger asset, is nearing its inflation-adjusted all-time high after three years of downward pressure.

According to Visual Capitalist's analysis, the price of gold reached $678 in 1980. Taking inflation into account, $678 in 1980 is equivalent to about $2,142 in 2020, according to calculations by Officialdata.org.

According to TradingView, gold technically broke through its all-time high this year, reaching $2,075 per ounce. However, its 1980 record purchasing power level has not been broken. Since the gold price soared to $2,075 per ounce in August, the gold price has begun to fall back, and at the time of the report, the gold price is close to $1,778 per ounce.

According to Coinbase's price index, Bitcoin hit an all-time high of $19,891.99 in 2017. Officialdata.org says that taking inflation into account, Bitcoin's all-time high is $21,131.02.

Gold has stood the test of time as a store of value for thousands of years, and in every era, people have determined the value of gold through buying and selling, thereby conducting price discovery. However, Bitcoin may change the game. Bitcoin is similar to digital gold, a scarce commodity used for value storage. Bitcoin has a lower threshold for storage and trading, and also has a limited supply.

Economist Schiff has repeatedly compared gold to Bitcoin and often considers Bitcoin worthless. Although gold's price moves slowly compared to Bitcoin, Schiff likes gold because it maintains wealth.

Bitcoin has experienced a dramatic price rally in recent weeks, coming within $100 of its all-time high on Coinbase. Macro investor Raoul Pal recently said he plans to sell his gold holdings and buy more Bitcoin.

“I have a sell order tomorrow to sell all my gold and buy BTC and ETH in proportion (80/20). I don’t hold anything else (except some bond calls and some USD)” he tweeted on November 29.

As Bitcoin prices rise, people are reportedly exiting the gold market, as shown by recent record outflow data.

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