Draper’s confidence in the digital money stems from the fact that he believes would be so much easy to use it would be laughable to continue using fiat currencies.
“In five years, if you try to use fiat currency they will laugh at you. . . and other will be so relevant … there will be no reason to have the fiat currencies.” He says.
Although it would be imprudent to dismiss the opinion of a man who made himself $10,000 when was still a fairly alien concept, there are a few consideration we cannot afford to bypass. For instance, what criteria does needs to meet in order to be considered as ‘money’ in the global economy?
The USB (Union Bank of Switzerland) that for to be considered a viable asset class and replace the U.S dollar, it would need to have a value of USD 213,000. Currently, though, the USB believes that is still very unstable to qualify for a mainstream asset class or viable means of payment for global transactions.
However, there are a few findings that contradict the USB report. For instance, a by Goldman Sachs titled “ is Money” argues that the digital coin is already money and an asset class which is currently taxable. Additionally, a by The Imperial College London and eToro titled : Overcoming Barriers to Trust and , seems to concur with the Goldman Sachs one. According to the research paper, satisfies the “ of value” role which is one of three roles that digital currencies must meet to be considered as money. This makes it a favorable candidate for mainstream within the decade.
However, it will still have to address issues of design, and scalability in order to satisfy the two remaining roles.
could supplant 25% of fiat currency by 2030
One of the reasons why most of those who have warmed to the idea of believe that will penetrate the mainstream business space is because of the perceived restrictions affiliated to the current currencies. For instance, most of the fiat money around the world are only valuable in certain jurisdictions. One notable example is the Nigerian Naira whose value plummets by about 30% when it crosses its native borders.
What is more, some financial gurus argue that the more than three-thousand-year-old banking system lacks pertinent technology to keep the current economic model afloat.
Because of this, Futurists like Thomas Frey believe that digital currencies will be the more favorable alternative and set to witness large scale . In fact, according to Mr Frey, roughly 25% of fiat money by 2030.
Why ?
Although initially enjoyed a monopoly in the industry’s market capitalization, other such as , and have sprung up and seem to be braced for tough competition. However, still holds greater potential for mainstream as compared to the other digital coins. For instance, according to , only two of the 54 major companies that accept do not accept .
This makes the most used digital coin in mainstream business and, therefore, when it comes to the question of which of these might replace fiat currency, comes up more often.
What to Expect
Opinions surrounding the question of whether digital currencies will take the place of fiat money seem to be highly subjective and speculative and therefore not easy to get a decisive answer. It is hard to tell whether thewill burst or keep floating as more people take interest in it.
Currently, none of the known or digital has successfully replaced fiat currency in any party of the world. So we still have a lot to anticipate and should be ready for any future surprises.
About the Author
Nathan Laibuch is a enthusiast and a freelance content writer. For more information about his writing services email him at nathanlaibuch@gmail.com.
Published at Fri, 19 Apr 2019 16:03:17 +0000
