We all know some of the important uses of gold: as currency and coins; for gold wedding rings and gold crowns.
But due to the extraordinary characteristics of gold – it has excellent thermal and electrical conductivity and is resistant to corrosion – there are some truly surprising industrial uses for gold, too.
This article will explore the common uses of gold, from surgical instruments and wealth protection to space exploration and awards, and how they impact gold prices .💰
Let's start with the biggest five uses for gold.
1. Wealth protection and financial exchange
One of the oldest and most well-known uses of gold is as currency and financial exchange. 💸
King Croesus of Lydia was the first to mint gold coins and use them as currency in 550 BC, long before paper money was introduced.
Gold has been used for centuries as a means of preserving and protecting wealth. Governments, central banks, financial institutions, and private investors still purchase gold as a physical store of value.
Many countries, including the United States, Germany, Russia, and China, hold significant gold reserves to support their economies. The United States leads globally with the largest gold reserves, amounting to 8,133 tons. This accounts for over 70% of its total foreign reserves. Germany follows, holding 3,359 tons of gold. Russia and China also have substantial gold reserves, with Russia having 2,299 tons and China holding 1,948 tons.
As a rare, tangible asset gold has historically maintained its value even when other assets like paper currencies have declined in value. For example, the South African gold bullion coin, the Krugerrand, is widely held and traded around the world.
🏆Start building wealth with Auto-Savings
At GOLD AVENUE we've made it simple to start building your gold collection. Our Auto-Savings feature allows you to set up recurring automatic gold purchases to match your budget. Build your savings hassle-free and without having to think about the price. Manage, pause, or cancel at any time, and resell instantly with 0% commission.
2. Jewelery, adornments and medals 🏅
Gold has a long-standing association with luxury, beauty, and prestige, making it a popular choice for jewelry and decorative items.
The majority of global gold consumption is in the form of jewelry, with China and India the largest consumers.
So, in the first three-quarters of 2023, China really upped its game in buying gold. They bought about 7.32% more gold than they did during the same time in 2022. That's a whopping 835.07 metric tons in total! And guess what? A big chunk of that, over 550 tons, was just for gold jewelry. That's 5.72% more jewelry gold than last year.
Gold's unique properties, such as its high luster and desirable yellow color, make it perfect for jewelry manufacturing, contributing significantly to the jewelry industry.
In addition to jewelry, gold is used to enhance the value of awards, medals and badges. Gold leaf, often made from 24-karat gold, has been traditionally used to adorn artworks, and even contemporary artists have incorporated gold into their creations.
Artist Maurizio Cattelan even exhibited a fully functioning gold toilet in the Guggenheim Museum! That's way more interesting than getting gold dental fillings.
Gold's exceptional conductivity, corrosion resistance, and high heat tolerance make it an ideal material for use in electronics and computer technology.
It is commonly used in the production of wire, cables and connectors, ensuring efficient and reliable transmission of electric signals.
With the ever-increasing demand for modern technology, such as cell phones, tablets, calculators and televisions, the electronics industry consumes a significant amount of gold each year.
Gold's non-reactive nature makes it great for use in electronic components, ensuring hardware like memory chips have longevity and reliability.
💡Did you know that in 2019, nearly 37% of all the gold used in the U.S. was actually for making electronic stuff? It turns out that electronics are the second-biggest user of gold, right after jewelry and gold bars, which use about half of the gold. And it's not just the fancy gadgets that have gold in them; it's also in things we use every day like our cell phones, computers, and even TVs.
4. Space exploration 🚀
Gold plays a crucial role in the aerospace industry, particularly in space exploration.
Its high reflectivity and thermal stability make it indispensable for shielding spacecraft from infrared radiation and heat.
Gold-coated panels and visors help regulate temperatures and protect astronauts and equipment during NASA's space missions. Gold's reliability and conductivity also make it valuable in electronic components used in space.
Extreme conditions like temperature fluctuations and radiation require materials that can withstand these challenges like gold conductors.
Gold's unique properties make it an ideal choice for critical electronic components in NASA's space missions.
Satellite technology and gold are also connected. The precious metal is crucial to the aerospace industry as enhances the performance and reliability of satellites.
Gold is often used to coat satellite mirrors and solar panels, as it has excellent reflectivity and thermal properties.
💡Gold has played a significant role in NASA's space exploration missions
During the Apollo 11 mission, for example, a very thin layer of gold leaf was used as the top layer of a thermal blanket, which was part of the Lunar Module's design. This blanket was composed of multiple layers of different materials, including glass, wool, Mylar, Kapton, and aluminum. The gold layer was crucial for its ability to reflect dangerous infrared radiation.
Additionally, gold's reflective properties were also utilized in astronauts' helmet visors, allowing visible light to pass through while reflecting infrared light. This use of gold ensured the safety and comfort of astronauts during their spacewalks and activities on the moon.
In later missions, such as Apollo 16, NASA continued to leverage gold's unique properties. The mission included a gold-plated extreme ultraviolet telescope, which conducted the first astronomical observations from the moon.
By the way, did you know that gold actually comes from the outer space??
5. Medicine and dentistry
Thanks to its non-reactive and non-toxic nature, gold has several medical uses.
Small amounts of gold isotopes are used in the diagnosis and treatment of certain illnesses, including cancer.
Gold use in medicine is varied and significant. Gold nanoparticles are used for drug delivery. Gold therapy can even be an effective way to control arthritis.
What are the uses of gold in dentistry? Gold fillings have been used for centuries as crowns and bridges. The inertness and ease of use of dental gold help make it a super useful metal.
What else can gold be used for? 👑
The use of gold extends to lots of other areas of life too. Gold is used in home appliances, glassmaking, and even cooking.
- In multi-story buildings, glass coatings use gold to regulate temperature and reduce heat absorption.
- The reflective properties of gold make it an excellent choice for enhancing the energy efficiency of buildings too.
- The automotive industry use gold in catalytic converters and electrical connectors.
- Gold is an essential component in touchscreens and sensors.
- Scientists use gold circuitry to conduct electricity and the metal appears in high-precision weighing instruments and laboratory glassware.
- Pure gold, known for its luster and softness, is often too malleable for practical use, so gold alloys - where gold is mixed with other metals like palladium and silver to enhance its inherent properties - improve its durability and strength so it can have a variety of extra uses.
- White gold, an alloying of gold with palladium or silver, creates a contemporary alternative to the classic yellow gold in jewelry.
- Similarly, rose gold gets its distinctive pinkish hue through the addition of copper.
So how do these gold uses impact gold investment?
Plenty of things can affect the price of gold, such as the monetary policy of governments, the US Federal Reserve, inflation, and even the US dollar.
Investors should be aware too that as a finite resource, supply and demand can also have an impact on the price of gold.
- The Gold Demand Trends Q3 2023 report by The World Gold Council has said gold demand in Q3 was 8% ahead of its five-year average.
- Central banks are buying gold at a historic pace, which has limited supply.
- As the need for gold in green technologies increases, the demand for gold will likely increase too.
- Solar Energy Industries Association expects the solar industry to nearly triple in cumulative deployment by 2028, which will increase demand further.
- Gold mining production is now at an all-time high: the World Gold Council's recent data shows that there's been a 6% jump in the total gold supply compared to last year. This increase is mostly because of more gold being mined and recycled. In fact, in just the third quarter of this year, they mined a record-breaking 971 tons of gold! Overall, in 2023, they've already supplied 3,692 tons of gold, which is a lot. So, it's safe to say that gold mining was really booming in 2023.
- Large gold extraction, high gold recycling rates and continued gold refining could all impact gold prices.
💡Buying gold: how to get started 📊
At GOLD AVENUE, we have a wide range of gold coins, ingots, and bars available to buy.
When you buy gold with us you can choose some of the most popular gold coins on the market. From the classic American Eagle coin from the US Mint to the stunning Canadian gold Maple Leaf from the Canadian Mint.
Our gold cast bars, like the 1 kg bar fine gold, and minted bars come from the world-renowned Swiss refinery PAMP.
So can different uses of gold affect the price of gold?🤔
For centuries, the use of gold as a currency and the minting of gold coins made it one of the most prized metals in the world.
But more recently, its special properties as a metal have made it indispensable to various industries. From its traditional uses in jewelry and gilding to more recent applications in electronics, alloys, space exploration, medicine, and gold diagnostics, gold continues to play a vital role in modern society.
As the world progresses towards a greener future, the demand for gold could rise, especially as central banks buy significant amounts of the yellow metal.
💡Did you know?
The demand for gold in various sectors such as jewelry, technology, investment, and central bank reserves influences its market price. High demand in one or more of these areas can drive the price up, while a decrease in demand can lead to a price drop. For instance, if the jewelry industry sees a surge in demand, this could increase the price of gold. Similarly, investment demand, often influenced by economic factors, can significantly affect gold prices.
Learn more here: Understanding the Price of Gold
To start your own savings journey with GOLD AVENUE, check out our selection of gold bars and coins.