Published
4 years ago on
December 06, 2019
- Deutsche Bank has recently said that it believes cryptocurrencies could end up becoming the replacement of fiat currencies by as soon as 2030.
- They cite crypto to be the “forces that hold the fiat money system together”.
The Deutsche Bank has recently said that it believes cryptocurrencies could end up becoming the replacement of fiat currencies by as soon as 2030. They cite crypto to be the “forces that hold the fiat money system together” which are starting to unravel.
The news came out in a report earlier today by the veteran bank. On top of this, the news follows stories that surfaced last week in that that Germany is tipped to start giving the green light to enable financial institutions to start dealing with crypto as early as next year.
Fiat and crypto
The report goes onto highlight something very unpredictable, especially for a big bank like Deutsche, the complete collapse of fiat currency.
An analyst from the banking giant, Jim Reid argues that traditional currency has been the subject of a kind of ‘arcane’ experiment ever since the dollar’s decoupling from gold in 1971.
He writes:
“That this current fiat system has survived so long has required a fortuitous set of global forces across multiple decades that have created sizeable natural offsetting disinflationary forces.”
Banking
Despite all of this, the idea of central banks completely collapsing is floating about but this isn’t exactly a new thought.
Reid makes the argument that ageing populations have the potential to increase the costs of labour on an international scale. As a result, inflation rates will likely surge to a level that is well beyond the grip of state-level control.
Reid says that in this chaotic scenario the “multi-trillion dollar (or Bitcoin) question”, is whether or not fiat has the capability to fight alternatives such as crypto and gold.
“The forces that have held the current fiat system together now look fragile and they could unravel in the 2020s. If so, that will start to lead to a backlash against fiat money and demand for alternative currencies, such as gold or crypto could soar.”
It will be interesting to see how this situation plays out. For more news on this and other crypto updates, keep it with CryptoDaily!
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