Part 2: A road to digital silver

Gold. Gold never changes.

Gold, a yellow-colored metal, has been valued since ancient times, and this belief persists across generations. While silver, less expensive but more practical, also warrants attention, we begin with essential facts about gold. Gold and silver originally served as mediums of exchange and value stores. Gold, closely linked to world currencies, especially the US dollar, saw a significant shift when US President Nixon abolished the dollar-to-gold exchange under the Gold Standard. Since then, gold has primarily been a value store, a non-functional metal. It's an asset for banks and wealthy individuals with limited industrial use beyond jewelry and high-end electronics. Consequently, the liquidity of mined gold in global circulation is diminishing slowly.

Due to its high value, gold investment isn't typically accessible to the average person. Conversely, silver, historically more utilized in industry and less hoarded than gold, is gaining more attention. With over 140 industrial and manufacturing applications, including in green energy, electronics, and pharmaceuticals, silver is becoming increasingly significant. Despite being rarer than gold based on mined supply, with a global supply decrease of 90% in the last 20 years, silver is primarily consumed rather than hoarded.

The growing demand for silver and slow mining production logically point to a potential short-term price surge. Mining silver, often a byproduct of gold mining, is challenging and less lucrative, making miners hesitant to focus solely on silver. This contributes to the slow depletion of the silver supply. A significant shift could occur if silver reaches 50% of gold's value, potentially surpassing it in the long term. Recall that silver has outpaced gold's price twice in modern history, notably during periods of high industrial demand and when market dynamics favored silver's diverse applications over gold's primarily value-store role.

Speculating that silver will reach half of gold's value is intriguing. Such a shift would be remarkable, considering their historical price relationship. Silver's value, like gold's, depends on market demand, mining costs, and economic conditions. Traditionally valued lower than gold, silver is seen as more accessible. However, market fluctuations and changes in demand or economic conditions could significantly impact the value of silver, presenting an engaging discussion on the complexities of precious metal markets.

Now, can silver reach 50% of the value of gold?

For many, the question revolves around whether silver will regain its monetary premium. Currently, gold enjoys much of this premium, owing to its historical significance, endorsement by central banks, and the value placed on it by many people in the form of jewelry and endowments. In contrast, silver, demonetized by central banks, lacks this status. It would only become more pertinent in a scenario where the global economy shifts back to a hard/resource-based monetary system and where gold's high value makes it impractical for smaller transactions, making silver a more practical choice.

Therefore, I am not fully convinced by the argument for silver's re-monetization. Digital currencies like Bitcoin (BTC) or Ethereum (ETH) offer even greater practicality in such a scenario. At least... this was my belief in 2020.

By mid-2021, my attention shifted to the Kaspa project, which I discovered to be akin to a digital silver complementing Bitcoin's gold. Kaspa's design addresses the well-known trilemma in blockchain technology - achieving scalability, decentralization, and security simultaneously.
Its innovative and visionary features align closely with the concept of digital silver, more so than any other cryptocurrency I had researched up to that point. This project stood out due to its unique approach and potential to redefine the role of digital assets in mirroring traditional precious metals like silver and gold.

Conclusion

Concluding the main discussion on silver's potential, it's important to recognize how the considerable presence of silver in monetized forms, such as coins and bars, has historically played a role in suppressing its prices. In contrast to gold, silver boasts a wide array of real-world applications. Its uses span across various industries, including batteries, electronics, medicine, and photovoltaics. This practical demand for silver is a key factor that will likely propel its value forward.

Certainly, considering the current standards in the digital asset space, Kaspa emerges as a strong candidate for the role of 'digital silver.' Its technological framework, rapid emission schedule, and strategic positioning in the cryptocurrency market align with the qualities traditionally associated with silver in the physical world.

Kaspa's innovative approach to addressing key challenges in blockchain technology, such as scalability, decentralization, and security, further reinforces its potential while addressing both the two important factors: being a store of value and a medium for peer-to-peer and microtransaction.
The focus on microtransactions typically emphasizes their small size and the ability of digital and cryptocurrency platforms to handle these efficiently, which traditional banking systems often find challenging due to higher transaction fees. This positions Kaspa uniquely in the digital currency landscape, mirroring silver's role and value proposition in the traditional precious metals market. It is used as money and can be used as finance.

Kaspa is community-supported to claim the global reach, geared with a strong base layer, and technologically highly evolved to provide a supreme application layer for smart contracts that can concur with these we know on Ethereum.

Not forget that the translation of the word kaspa is "silver," and its circulation supply was designed for Kaspa tokens to be used, not only to hold.

Epilogue

If we imagine the global interconnection as the wheel that propels modern civilization forward, TCP/IP is like the pneumatic tire added to the wheel, bringing us from the age of the electrical telegraph to the age of the Internet.

Now, the blockchain promises to add yet another layer on top of the tire, which would enhance the wheel's functionality even further. Perhaps, if things go well, Kaspa's blockDAGs could be like an anti-gravity harness, giving the oft-lumbering vehicle of humanity a chance to soar into the heavens. And yes, the tickets will be paid in silver.