For over four thousand years gold has been regarded as a form of money and store of wealth. The use of gold superseded alternatives for a number of reasons including its rarity, luminosity, character (weight, softness), malleability, fungibility and resistance to tarnish.

Since the collapse of the gold standard, gold has largely lost its role as a form of currency, but is still considered by many, especially by central banks, as a store of value and a safe haven in times of crisis. Gold and other precious metals are unique assets in that they are real (i.e. have real value) and liquid (i.e. easily traded), unlike property which is real but not liquid, or company shares which are liquid but not real (i.e. a share certificate is just paper). Other traders and investors see gold as nothing more than just another commodity, such as copper or lead, and treat it as such.

However, gold does maintain a special position in the market with many tax regimes. For example, in the UK the trading of gold is free of VAT. Silver, and other precious metals and commodities, do not have the same allowance. UK capital gains tax may still apply for individuals.

All text is available under the terms of the GNU Free Documentation License (see Copyrights for details).