Why Ethereum + Chainlink = Digital Gold

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Gold bugs and bitcoiners have gone to battle over what will be the world's future store of value, and few arguments are more familiar than the infamous gold bug Peter Schiff. Gold is a tangible, real world material that people actually use for stuff, while Bitcoin is not.

Bitcoiners counter with a very valid argument in response. Their stance is that gold is heavy, clunky and needs to be stored, usually by someone other than yourself. This leads to an inconvenient form of money because while bitcoins can be broken up into satoshis immediately and conveniently, gold has to be shaped into a variety of weights that can be difficult to manage with any where near the same precision.

Another key point made by the Bitcoiners is that gold, in the hands of a trusted thirdparty, is not guaranteed to ever actually be there. Gold might not actually be with the thirdparty you rely on, because they might have secretly loaned it out. Also, historically, governments have been able to outlaw the use of gold, while doing this with bitcoins might be a little more challenging.

Peter Schiff argues that gold ownership rights can digitally transfer hands just as quickly and easily as bitcoins can transfer hands. However, with Bitcoin you know that you have true possession of the asset, while that is not so with gold unless you are physically holding the coin itself, which is then not easily transferred across borders if needed.

Both sides have their points, but gold just might be about to win against Bitcoin. I know that might not be a popular thing for people to hear by bitcoiner ears, but it actually might be a very good thing for the cryptocurrency industry overall.

Projects like DigixDAO have tokens backed by real world assets such as gold. This has always been a loose connection that is not necessarily reliable. However, all this changes with Chainlink, a project that connects the blockchain to the real world. Now, it is possible to verify that a token is backed by a real world asset and have the assurance that the party possessing the asset is staking LINK as proof of accuracy.

The combination of Ethereum and Chainlink can open up the cryptocurrency world to having digital assets that are provably backed by the real world asset they claim to be.