Is Gold Still A Worthwhile Investment?

Throughout history, gold has virtually always been a worthwhile investment, but with gold fraud on the rise and the world currently battling a pandemic, is it still worth investing in today? 

The rise of gold fraud 

As gold prices continue to increase, gold fraud becomes a growingly expensive issue, and trust in gold has started to decrease. China has recently found itself at the center of the gold-fraud scandal when it was discovered that more than 4% of its office gold reserves may be fake. In this instance, the fake gold was being used as collateral against a $4 billion loan, but who’s to say what other tamperings are currently happening worldwide.  

Protecting yourself from gold fraud

Although gold fraud remains a concern, the good news is that there may now be a solution. Traceability technology has now been invented to track and trace gold bullion and detect when it has been tampered with. The platform uses extremely advanced image processing and blockchain technology to track gold through the entire supply chain, ensuring that each individual can be confident that they are receiving and holding real gold. Thanks to ABC Refinery’s CME Group accreditation, gold fraud may soon no longer cause as much of an issue as it has previously. 

Is gold still a worthwhile investment? 

Despite the threat of gold fraud, gold remains a worthwhile investment for three key reasons: 

1. Gold is still a hedge against inflation 

Unlike fiat currencies, gold is not controlled by a centralized bank and is not backed by a global institution. Therefore, it preserves its value, acting as a hedge against inflation despite the uncertainty going on around it. 

2. Gold prices are much less volatile

During times of uncertainty, gold is a tangible asset that is not affected by geopolitical drama or macroeconomic uncertainty. Unlike fiat currencies, which can be very volatile, turning on a dime, gold prices remain relatively unshaken. 

3. Gold is scarce and in demand 

As a scarce and finite resource, gold rarely sees any drop in demand and is still the most wanted precious metal in the world. Even in the face of a global pandemic, gold demand has stayed steady, and analysts predict that its demand will rise in the coming years once COVID-19 has been put behind us. 

Is now the time to invest?

In 2019, the price of gold rose from $1,286 per ounce to $1,525 per ounce, an 18.5% gain across the 12 months. As one of the highest-performing investments of 2019, a lot is resting on gold performance in 2020, but is it a good time to invest? 

As the world recovers from the first wave of Coronavirus, the US, China, and most of Europe wait tentatively for a second wave that could shut down production and close their borders once more. With global growth at risk and so much political and economic uncertainty, there is more pressure than ever on gold to provide a stable investment opportunity, and experts believe that now is the time to invest.