While the US dollar won’t give up its position as the world’s reserve currency any time soon, it’s definitely getting weaker compared to alternatives such as Bitcoin, wrote Brad Garlinghouse, the CEO of Ripple. The CEO further noted, “A year ago, many decried crypto as a scam, and now a majority of governments are looking seriously at blockchain. It addresses frictions (i.e., settlement, transparency, etc.) that were assumed VERY hard to solve before. Crypto is up 80% while USD is down 3% YTD.”
The global population is losing confidence in fiat currencies.
Ripple CEO Brad Garlinghouse quoting, Fundstrat Global Advisors’ Thomas Lee said, “it comes down to trust in the financial system at the end of the day. As global populations continue to lose confidence in fiat currencies (as we’re seeing with USD), they will choose to diversify.” Our future global financial system will do the same, he further claimed. The CEO added that traditional monetary systems are usually as strong as people’s trust in them—and fiat currencies are increasingly losing it today.
As @fundstrat said, it comes down to trust in the financial system at the end of the day. As global populations continue to lose confidence in fiat currencies (as we’re seeing with USD), they will choose to diversify. Our future global financial system will do the same (3/3)
— Brad Garlinghouse (@bgarlinghouse) August 3, 2020
Central banks are already exploring digital currencies.
Central banks across countries are already experimenting with digital currencies. However, centralized digital currencies issued by banks is a very different concept than what cryptocurrencies are. A decentralized cryptocurrency like bitcoin gives power back to the people from traditional financial institutions. China is all set to become the world’s first major nation to have its own digital currency. Several experts have claimed that the Chinese national digital currency could threaten the US dollar’s global dominance.
Earlier, a report by the Bank for International Settlements had revealed that the ongoing global pandemic had exemplified the need for CBDCs around the world.