By Bill Taylor/Fintek Capital
So, could the U.S. dollar actually be replaced as the world’s reserve currency by a cryptocurrency? If you say no, you might want to think again. Think people will never give up their bank accounts for crypto (bitcoin) wallets? Not that long ago, airlines actually (gasp) printed “real” tickets before going paperless. The thinking then was that people would never get on a plane without a piece of paper to hold. And that was even before blockchain.
Step back in time, and you’ll discover the British pound and the Spanish dollar were once THE global currency. There are many major economies around the globe that may actually want a true digital currency. Russia has been working in that direction for quite some time and there are others. And keep in mind that the U.S dollar’s overall share of central bank reserves have been dropping over the past five years. Something to think about.
So what would replace the good old greenback? How about a Facebook Coin? Some think Facebook would actually like to replace the dollar. Or, Amazon? Or Alibaba? Or Apple? A better ‘bet?’ Bitcoin! Everyday bitcoin is being accepted at more and more places. Even the New York Stock Exchange with their new Bakkt Exchange is working with partner Starbucks to allow coffee drinkers to use bitcoin in their stores. Close your eyes if you must, but don’t ignore the obvious; the dollar’s days are numbered. Really! Smart thinking says by 2030 the dollar is replaced. No wonder central banks are…….uh, concerned?
Already some global central banks are considering issuing a digital fiat currency but that’s only a “hop skip and a jump” to decentralization. Those efforts are a break from a U.S. fiat dominance. There is also already an erosion from central banks being reliant on the SWIFT banking network. The International Monetary Fund (IMF) has recently announced that it will put its world money (Special Drawing Rights….SDR) on a distributed ledger which would, sort of, make SDR’s a global cryptocurrency.
So, will Bitcoin, and the blockchain technology behind i,t render central banks, politicians, large corporations and even governments obsolete when it comes to money?
Or, better asked, what if it does?
Bill Taylor is Managing Partner at digital assets fund Fintek Capital, a thought leader in the crypto space & a frequent contributor to FintekNews