How Crypto Could Become A Global Reserve Currency
Apart from recent volatility, the vibrant discussion around bitcoin, stable coins, & other crypto assets is clearing the way for a much more substantial discussion about the future of money in the twenty-first century. Integrating features of blockchain & crypto capabilities, in particular, may assist sustaining the US dollar’s value and position in an extremely competitive currency scene.
Despite all the talk and hype around bitcoin, Dogecoin, and other cryptocurrencies in recent weeks & months, substantial work has been achieved in another area of crypto development: integrating blockchain & crypto into current fiat currencies. On the surface, it seems contradictory, but the integration and fusion of fiat and cryptosystems makes sense, although maybe not for the reasons that some market players originally believed.
With the exception of crypto maximalists who believe in the impending and unavoidable collapse of fiat-based monetary systems, there is already a lot of market data indicating that the fiat & crypto economies are convergent. For example, the whole stable coin industry is built on the premise that an on-ramp & middle ground between fiat and crypto is still required for payment & transactional reasons. This is not even mentioning the many efforts undertaken in the past year or so by payment gateways and providers to allow crypto payments.
The senator made waves in 2015 when he declared that his presidential campaign would accept bitcoin contributions via its website.
This statement follows the Federal Elections Commission’s approval of an advisory opinion in 2014 allowing campaigns to accept bitcoin contributions subject to certain valuation and reporting requirements.
Paul said that cryptocurrencies are now larger than he anticipated they would be in 2015.
“I’ve been astounded by its development, but I’ve always been more of a believer that our money should be supported by something of actual worth, such as gold, silver, or commodities, and I’ve always wondered why crypto is not supported by anything,”.
https://twitter.com/bitcoinagile/status/1453452283312754693?s=20
“However, what I’ve come to think is that government money is so unstable because they are also fiat currencies, meaning they are not backed by anything.” The dollar is more stable than the currencies of the majority of other nations, and hence serves as the reserve currency,” he noted.
When asked how worried he is about illicit cryptocurrency usage and if the digital currency should be more regulated, Paul cited government control of the private bank accounts.
“I suppose I’m more worried about the government spying on the private bank accounts if they’re cryptocurrencies or traditional bank accounts,” he said.
The senator’s remarks come amid increasing attention on Capitol Hill on Bitcoin and a push by Democrats to make banks provide more information to the IRS for tax collection reasons.
https://twitter.com/CNBCFastMoney/status/1151608193761628161?s=20
From a broader view, the importance of integrating the fiat & crypto economies becomes clearer; money and payment infrastructure are in desperate need of an upgrade. While this is not a surprise to anybody in the payments industry, there are various reasons behind it that go beyond merely improving payment efficiency & transparency. Specifically, when it comes to the dollar’s standing as the world’s reserve currency and its role as the backbone of an international payments system, its critical significance of incorporating certain blockchain components cannot be emphasized.
https://twitter.com/4TaxFairness/status/1453459437486739458?s=20
Consider A Handful Of The Explanations Why:
The advantage in the marketplace: it is a well-known fact that as the globe has grown more globalized and politically-multipolar, the battle between states striving for leadership has intensified tremendously. Apart from the headlines surrounding geopolitics, economic activity and foreign policy endeavors, it is impossible to overestimate the significance of a currency as one of these instruments. Numerous governments across the globe have started CBDC currency initiatives or something similar, indicating that perhaps the business model is plainly evident.
