From 6000 BC to 21,000,000 BTC (Part III): From Gold to Silver, Copper Coins, and Paper Money, How Should Bitcoin, Stocks, Bonds, and Commodities Be Compared?

If you only look at price charts, Bitcoin, stocks, bonds, and commodities all look like numbers jumping on the same screen; but if you extend the timeline back to the monetary history of gold, silver, copper coins, and paper money, they actually represent completely different value logics. Readers need to understand this issue because mistakes in asset allocation are often not about buying the wrong ticker, but about mistaking one asset for another: treating an asset with no cash flow as a bond, treating a high-volatility asset as a cash substitute, treating a cyclical commodity as a permanent store of value, or treating technical custody risk as ordinary account risk.

Trezor’s “From 6,000 BC to 21,000,000 BTC” series uses the evolution of money as a thread to discuss the changes from early physical money to metallic money, and then to paper money and Bitcoin. This perspective offers an important insight: money and assets do not earn trust out of thin air; rather, trust is repeatedly balanced among scarcity, divisibility, durability, verifiability, liquidity, and social acceptance. Gold, silver, and copper coins once served as media of exchange, stores of value, and units of account; paper money gradually shifted its value anchor toward law, credit, and institutional arrangements; Bitcoin tries to provide another kind of digital scarcity through code, consensus, and a fixed issuance cap. In today’s investment portfolio, what we need to compare is not “who is more advanced,” but “in what scenario does each asset bear what kind of risk and provide what kind of exposure.”

1. First establish the comparison dimensions: don’t just ask which asset went up more

Comparing Bitcoin, stocks, bonds, and commodities requires looking at at least eight dimensions at the same time: return sources, volatility characteristics, liquidity and trading hours, cash flow and valuation methods, inflation sensitivity, interest-rate sensitivity, correlation and diversification effects, and custody and access methods. A single metric can easily mislead. For example, an asset’s very high return over the past three years does not mean it will continue to perform well in a recession, liquidity contraction, or regulatory shift; lower volatility does not mean an asset has no risk, because bonds may still have duration risk, credit risk, and reinvestment risk.

A simplified positioning of the four asset classes is as follows:

This table is not an investment conclusion; it is meant to prevent confusion between levels when comparing assets. Stocks represent claims on residual corporate earnings, bonds represent contractual claims on an issuer’s future repayment, commodities more closely reflect physical supply-demand and inventory constraints, while Bitcoin is a digital asset based on network consensus and a fixed issuance rule. All of them may appear in the same portfolio, but they do not serve the same function.

2. Return and volatility: behind high-return narratives are different sources of risk

Return comparisons are most easily pulled by historical performance. Bitcoin has shown extremely high convexity in some cycles, but this usually comes with severe drawdowns; long-term stock returns come from earnings growth, capital returns, and valuation expansion, but a single industry or market can also experience years of stagnation; bond returns are relatively explainable, mainly coming from coupons and interest-rate changes, yet they can still suffer significant losses in periods of rising inflation or rapidly rising rates; commodities may rise when supply is tight, during wars, energy shocks, or rising inflation expectations, but they can also fall quickly as demand weakens and inventories build.

Volatility is not simply a “bad thing”; it is a constraint on risk tolerance and investment horizon. A long-term investor can tolerate price volatility, but may not be able to tolerate liquidity interruptions, forced liquidations, or custody failures; a short-term investor may still be forced out by excessive drawdowns even if the long-term direction is correct. Part of Bitcoin’s high volatility comes from the market still pricing its long-term role: is it a risk asset, an alternative store of value, a technological network asset, or a combination of several attributes? In different market phases, investors’ answers change.

Stock volatility is more often related to the earnings cycle, industry competition, valuation levels, and monetary policy. Bond prices may appear less volatile, but long-duration bonds are very sensitive to interest-rate changes; if rates rise, existing bond prices may fall. Commodity volatility is often tied to real-world supply chains, inventories, weather, and geopolitical events, many of which cannot be fully captured in advance by financial models.

A concrete example: suppose an investor puts funds that will be needed for a house payment in three months into a high-volatility asset. Even if the long-term judgment is correct, a short-term decline may create a cash shortfall. By contrast, if the funds are part of a long-term allocation that will not be needed for more than ten years, the investor can focus more on the asset’s role under different macro environments rather than on daily price swings. Asset comparison must first match the use of funds and the time horizon.

3. Liquidity and trading hours: being tradable does not mean you can always exit at low cost

One notable feature of Bitcoin is that it trades globally around the clock; on-chain transfers do not depend on traditional bank business hours, and trading platforms usually provide 24/7 price discovery. This is clearly different from traditional stock and bond markets: most stock markets have fixed trading hours, while bond markets are mostly over-the-counter, with transparency and liquidity varying by instrument. Commodity markets include both spot and futures, and the liquidity, margin, and delivery rules of different contracts vary greatly.

But “tradable at any time” does not mean “always tradable at a desirable price.” Real liquidity includes bid-ask spreads, market depth, slippage, counterparty risk, settlement speed, and availability in extreme market conditions. Liquidity in major Bitcoin pairs is already relatively deep, but when the market becomes highly volatile, trading platforms may experience congestion, thinner order books, price dislocations, or withdrawal delays. On-chain settlement is also affected by network congestion and fees. Stocks have relatively high transparency during normal trading hours, but when trading halts, circuit breakers, earnings shocks, or market crashes occur, execution may become difficult or trade prices may deviate significantly from expectations.

Bond liquidity is especially easy to underestimate. Many bonds appear price-stable in normal times, but in stress environments bid-ask spreads can widen, especially for credit bonds, high-yield bonds, or small-issue instruments. Commodity futures liquidity is concentrated in the front-month contract; far-dated or non-front-month contracts may trade sparsely. If investors hold commodities indirectly through commodity ETFs or structured products, they also need to understand roll costs, fees, and tracking error.

Therefore, when comparing liquidity, you can ask four questions: First, how wide are bid-ask spreads in normal markets? Second, is it possible that execution becomes impossible in extreme markets? Third, how long do settlement and withdrawals take? Fourth, does the holding vehicle itself introduce additional counterparty risk? This is more practical than simply looking at trading volume.

4. Cash flow and valuation: stocks and bonds can be discounted, while Bitcoin and commodities rely more on supply and demand and beliefs

The core difference in asset valuation lies in whether predictable cash flow is generated. Bonds usually specify coupons and principal repayment, so valuation can be built around the yield curve, credit spreads, term structure, and default probability. Stocks do not have fixed repayment obligations, but corporate earnings, free cash flow, and dividends and buybacks provide a foundation for valuation. Even when the valuation result is not exact, investors can still judge whether prices are too optimistic or too pessimistic by looking at profit margins, revenue growth, capital expenditures, balance sheets, and industry competition.

Bitcoin has no issuer, no coupon, no dividend, and no claim on the assets of a specific company. Its value framework is closer to that of a non-cash-flow asset: a fixed supply cap, verifiable scarcity, network security budget, user adoption, liquidity, regulatory accessibility, and market recognition of its store-of-value properties all affect price. Gold also has no cash flow, but it has long-term jewelry, industrial, central bank reserve, and investment demand; Bitcoin forms its own demand base through digital portability, verifiability, and the narrative of resistance to arbitrary issuance. The similarity is that neither is suitable for direct valuation using a traditional discounted cash flow model; the difference is that gold has thousands of years of social acceptance history, while Bitcoin’s history is shorter and the technological and institutional environment is still changing.

Commodity valuation also cannot be explained simply with a cash flow model. Prices of crude oil, copper, agricultural products, and other commodities are affected by inventories, marginal costs, capacity cycles, and spot demand. Copper is often seen as one barometer of economic activity because it is tied to construction, electricity, and manufacturing; crude oil is influenced by OPEC+, geopolitics, transportation, and refining capacity; agricultural products are also affected by weather and seasonality. If commodity investing is implemented through futures, investors will also face contango, backwardation, and roll yield issues, meaning that a rise in spot prices does not necessarily translate into the same gain for the investment product.

An actionable checklist: before buying any asset, write down three sentences. First, do its returns mainly come from cash flow, price re-rating, supply-demand shocks, or scarcity narratives? Second, if the price falls by 30%, does the original investment thesis change? Third, if you need to exit, who is the most likely buyer and why would they buy? These three questions can effectively distinguish “understanding the asset” from “chasing the price.”

5. Inflation and interest-rate sensitivity: a rise in nominal prices does not equal an increase in real purchasing power

The history of gold, silver, and copper coins is closely tied to inflation. The appeal of metallic money partly comes from its extraction cost and physical scarcity, but historically there have also been debasements, revaluations of coinage, and changes in metal supply. Under paper money systems, money supply, fiscal policy, and central-bank interest rates become important variables affecting purchasing power. When comparing assets today, inflation and interest rates are two axes that must be considered together.

Bonds are the most sensitive to inflation and interest rates. Rising inflation may erode the real purchasing power of fixed coupons, and when central banks raise rates to curb inflation, existing bond prices usually come under pressure. Short-duration bonds are less affected by rate changes, but reinvestment returns and credit risk still need to be considered. Stocks react to inflation in a more complex way: companies with pricing power, strong balance sheets, and manageable capital expenditures may pass costs on to consumers; but high-valuation, long-duration growth stocks may face greater valuation pressure when rates rise.

Commodities are often viewed as inflation-sensitive assets because many inflation shocks themselves come from rising energy, food, or raw material prices. But this does not mean commodities are always an inflation hedge. If inflation is accompanied by a demand recession, some industrial commodities may fall; if investors hold commodities through futures, they must also bear roll costs. Gold may benefit when real interest rates fall, monetary credibility is questioned, or safe-haven demand rises, but it may also come under pressure in a high real-rate environment.

Bitcoin is often discussed as an anti-inflation asset because its issuance rules are transparent and its total supply is capped at 21 million. But a fixed supply does not automatically mean short-term inflation resistance. Price is also affected by demand, liquidity, regulation, leverage, and market risk appetite. In some phases, Bitcoin may look more like a high-beta risk asset; in others, the market may emphasize its attributes as a sovereign-independent scarce asset. When comparing, one should distinguish between “long-term supply rules” and “short-term price performance.”

6. Correlation and diversification: diversification is not just stacking up asset names

The value of a multi-asset portfolio lies in the fact that different assets respond differently to the same macro shock. Stocks are usually driven by earnings growth and risk appetite, bonds may provide a buffer in certain recession or risk-off environments, commodities may be more sensitive to supply shocks and inflation, while Bitcoin may be affected by risk appetite, liquidity, and internal cycles within the digital-asset market. In theory, these differences can improve the portfolio’s risk-return characteristics.

But correlation is not constant. In stable markets, assets may show low correlations; once liquidity stress appears, investors may sell multiple asset classes at the same time to raise margin or reduce risk, causing correlations to rise. The 2008 financial crisis, the 2020 market shock, and multiple subsequent rounds of interest-rate changes all remind investors that so-called “diversification” must be re-tested in extreme environments. Bitcoin’s correlation also changes across cycles: sometimes it behaves more like risk assets such as tech stocks, and sometimes it moves independently.

When comparing correlation, do not rely only on static historical coefficients. A more practical method is scenario analysis:

• If growth is strong, inflation is moderate, and rates are stable, stocks may benefit, and some commodities may also perform well due to demand growth.
• If inflation is high and rates are rising, long-duration bonds and high-valuation stocks may come under pressure, while commodities or certain real assets may benefit relatively, though not guaranteed.
• If the economy enters recession and risk appetite declines, high-quality bonds may provide a buffer, while stocks and high-volatility assets may fall.
• If there is internal risk within the digital-asset industry, Bitcoin may swing sharply independent of traditional macro factors.

Therefore, diversification is not “buy a little of everything,” but rather clearly defining each asset’s job in the portfolio: to provide growth, provide cash flow, hedge inflation, provide liquidity, take on non-sovereign scarce-asset exposure, or perform short-term hedging. Different tasks require different position sizes and risk budgets.

7. Custody and access methods: from metallic money to private keys, the form of ownership determines the shape of risk

The history of gold, silver, and copper coins shows that an asset’s physical form determines the costs of storage, transportation, verification, and divisibility. Metallic money is durable but bulky; cross-regional transportation is costly, and authenticity and purity need to be verified. Paper money improved portability and transaction efficiency, but shifted more trust to the issuing institution and the legal system. Bitcoin transfers ownership to private-key control: whoever controls the private key can sign transactions spending the corresponding assets.

This makes Bitcoin custody risk clearly different from that of traditional securities accounts. Stocks and bonds are usually registered through brokers, custodian banks, central securities depositories, and legal frameworks, and investors face intermediary, account, clearing, and legal enforcement risks. Commodities can be held physically, through futures, ETFs, or warehouse receipts, each with its own storage, insurance, roll, or counterparty risks. Bitcoin can be custodied by trading platforms, self-custodied using a hardware wallet, or held through multisig, institutional custody, or hybrid solutions.

The advantage of self-custody is reduced dependence on centralized platforms, but the cost is that the user must be responsible for private-key backups, seed phrase protection, device security, address verification, and inheritance arrangements. Platform custody is more convenient, but it introduces platform operations, withdrawal, compliance, hacking, and asset segregation risks. Multisig can reduce single-point failures, but it is more complex to set up and requires planning for signers, backup locations, and recovery processes.

A simple Bitcoin custody checklist includes: do you understand the difference between a seed phrase and a private key; have you made a small test transfer; can you identify phishing websites and fake wallets; have you stored recovery words offline; do you avoid taking photos, cloud backups, or sending them to others; have you planned for device damage, your own incapacity, or inheritance scenarios? For stock, bond, and commodity products, you should also check account protection, product structure, fees, redemption rules, and the liability boundaries of the issuer or custodian.

8. Bringing the historical perspective into real portfolios: roles matter more than labels

From gold to silver, copper coins, and paper money, changes in the form of assets and money did not eliminate risk; they only changed where the risk sits. The problem with metallic money may be weight, purity, minting rights, and safekeeping; the problem with paper money may be credit, inflation, and institutional constraints; the problem with financial securities may be issuer cash flow, valuation, and market structure; the problem with Bitcoin, however, is concentrated on whether digital scarcity is continuously recognized, how private keys are managed safely, whether the network and market infrastructure can operate long term, and how the regulatory environment changes.

In a real portfolio, the four asset classes can be observed under different “roles.” Stocks lean toward growth assets and are suitable for expressing a long-term view on corporate earnings and productivity improvements; bonds lean toward income and risk buffering, but are affected by interest-rate and credit cycles; commodities lean toward inflation, supply shocks, and real-demand exposure, but their volatility and roll issues cannot be ignored; Bitcoin leans toward a non-sovereign digital scarce asset and a high-volatility alternative asset, potentially providing exposure different from the traditional system, but it should not be regarded as a risk-free store of value or a cash substitute.

The limits of the conclusion are equally important. No comparison framework can guarantee returns, nor can it replace personal financial planning. History can help us understand why assets are accepted, and mechanisms can help us judge where risks come from, but future prices are still jointly influenced by macro, policy, technological, liquidity, and behavioral factors. A more robust approach is not to predict a single winner, but first to define the time horizon of funds, risk tolerance, liquidity needs, and custody capability, and then decide whether and how to allocate across different assets. For Bitcoin in particular, price judgment and private-key security should be handled separately: being right about direction but losing access still results in irreversible loss.

References

1. From 6,000 BC to 21,000,000 BTC, Part III: From Gold to Silver, Copper, and Paper：https://trezor.io/blog/insights/from-6-000-bc-to-21-000-000-btc-part-iii-from-gold-to-silver-copper-and-paper
2. Bitcoin Whitepaper: Bitcoin: A Peer-to-Peer Electronic Cash System：https://bitcoin.org/bitcoin.pdf
3. Federal Reserve Education: Bonds, Interest Rates, and the Impact of Inflation：https://www.federalreserve.gov/aboutthefed/educational-tools/default.htm
4. U.S. Securities and Exchange Commission: Investor Bulletin — Interest Rate Risk：https://www.sec.gov/resources-for-investors/investor-alerts-bulletins/ib_interestraterisk
5. World Gold Council: Gold as a Strategic Asset：https://www.gold.org/goldhub/research/relevance-of-gold-as-a-strategic-asset
6. OneKey Help Center：https://help.onekey.so/

Risk Disclosure

This article is for educational and informational purposes only and does not constitute investment advice, tax advice, legal advice, or any invitation to buy or sell. Bitcoin, stocks, bonds, and commodities all carry different types of risk: market risk includes sharp price volatility and long-term drawdowns; execution risk includes slippage, insufficient order book depth, trading platform congestion, trading halts, or circuit breakers; liquidity risk includes the inability to buy, sell, or redeem at the expected price in extreme market conditions; custody risk includes private-key loss, hardware damage, trading platform freezes, hacker attacks, account permission issues, or improper inheritance arrangements; technical risk includes issues such as wallet software, signing processes, smart contracts, or network congestion; leverage risk includes insufficient margin, forced liquidation, and magnified losses; regulatory risk includes changes in rules for digital assets, securities, derivatives, taxes, and cross-border transfers across different jurisdictions. Bonds also carry interest-rate, duration, credit default, and reinvestment risk; stocks carry the risk of earnings decline, valuation compression, and corporate governance; commodities carry inventory, weather, geopolitics, roll cost, and delivery-rule risk. Investors should make independent judgments based on their own financial situation, time horizon, liquidity needs, and risk tolerance.