Why Timothy Coles is Selling His $2 Million Gold Mine for Bitcoin
Stan Higgins | Published on July 27, 2014 at 12:30 BST
Timothy Coles is the man behind the profitable gold mine in the Yukon city of Dawson currently for sale for just over 3,200 BTC on luxury marketplace BitPremier.
With more than 30 years of experience in the gold mining industry, Coles brings a unique perspective to digital currency and the concepts that underly the technology. He sees bitcoin as a one-of-a-kind type of asset.
Coles told CoinDesk that he first learned about bitcoin while wintering in the Philippines. Casual research grew into more active investigation, leading to discussions about how bitcoin might fit into plans to sell off his gold interests in the Yukon.
With the mine now for sale on the luxury exchange, Coles is optimistic about bitcoin’s propsects, saying:
“I believe bitcoin has nowhere to go but up. In the long run, it’s just going to get stronger and stronger and stronger.”
He added that although he currently owns no bitcoin, he sees a future in it should the BitPremier sale succeed. While he has no active plans to invest were he to enter the market, Coles expressed an openness to invest in the broader bitcoin industry, including the mining sector.
The mine is currently on sale for $2m and reportedly generates $1m in annual revenue.
Bitcoin vs gold
When discussing the similarities and differences between gold and bitcoin, Coles cited the fact that the prices in digital currency markets are set by supply and demand.
By comparison, gold is subject to geopolitical pressures that have, in his eyes, made it a less attractive option over the years:
“The people that have the bitcoin are the ones that can drive the price up, or drive it down, depending on what ups. Whereas gold, the people that have the gold are really at the mercy of politicians, financial institutions, London fixes that we really know nothing about. People that have gold really have no control over the direction that goes.”
He went on to suggest that these influences could one day take a toll on bitcoin. However, he said that the decentralized nature of digital currency technology makes it “less susceptible to manipulation compared to gold”.
Coles added that the price of bitcoin went too high too quickly, resulting in an equally swift correction. In the month since – which has seen a raft of both positive and negative news for bitcoin – the price, he said, has risen on the merits of its strength rather than pure hype or speculation.
Bitcoin needs education
One of the key problem areas of bitcoin, Coles said, is a lack of education among the broader public. This is due to the novel characteristics of bitcoin that make it not quite a currency, commodity or property. Instead, it lies somewhere in the middle.
As a result, Coles reckoned, bitcoin’s success – and its price – hinges on whether or not more people learn about how it works, how they can acquire it and, most importantly, how they can use it.
“I believe that bitcoin needs some advertising the world over to learn more about what it’s all about. Nine out of 10 people I talk to have heard of bitcoin, but they don’t know about it, they don’t understand and they don’t want to because it’s out of their realm of understanding.”
Pointing back to the topic of political impact on bitcoin, having an environment in which more people understand how to use digital currency – and do so – could enable the bitcoin market to operate without manipulative influence from the outside.
More gold plans ahead
While citing problems in the global gold market, Coles said that after the sale of his mining interest in the Yukon he’d stay on the lookout for new opportunities. Issues aside, he said that he makes a “good living” in the gold market, joking that the industry was “spoiled” in 2012 and 2013 when gold prices surged above $1,700 an ounce.
“I would still always keep my eyes open for opportunities in gold mining. It’s something that’s in your blood.”
As outlined in the BitPremier advertisement, Coles is offering to help provide logistical and managerial support to a potential owner. The sale actually has two components: Canyon Creek, a developed, three-mile property with drilling and exploration already conducted on the plot, and an existing lease in the Bonanza Creek region.
Coles explained the real prize in the sale are his interests on Bonanza Creek, a waterway in the Yukon made famous for the abundance of gold discovered in the region. He suggested they are the heart of something that offers “big potential” to interested investors.