[AnonHP]

Gold has a few properties: one is that it has had value through history and another is that it’s a physical asset, and because of these two properties, it’s quite liquid. It’s also a metal that doesn’t naturally corrode.

Central banks of countries hold various kinds of assets, including bonds and currencies of other countries. But bonds and currencies are just “paper”…or are more vulnerable than gold to shocks in certain conditions.

The disadvantage of physical gold is that it doesn’t generate any income by itself, as compared to bonds.

During times of higher uncertainty, people and institutions (including central banks) flock to gold.