Crypto Could Become the Safe Haven Currency for Banks

Bitcoin as Global Reserve currency

As the economy slowly begins to tumble, banks are starting to look for other solutions to protect their reserves. Several banks around the world in Russia and Korea have already started to accumulate Bitcoin into their reserve stock piles, but how long until every bank does it? Let’s take a look at what is going on around the world right now, and why I think banks will soon start hording crypto.

Nothing should be taken as investment or financial advice. Enjoy the ride.

The World Economy Is Teetering

With Covid continually thrashing about the world causing panic and uncertainty, there is no telling what the afterward result will be. Right now the U.S. federal reserve is printing trillions of dollars to boost the economy and people are starting to notice as things seem unusual.

Not only that, but in the mist of an economic shut down, stocks and the market seem to be doing just fine contrary to what you might think would happen or should happen. While you would think big businesses are strapped for cash, the market seems to be pumping regardless of the situation. Clearly, this is a concern when most of the spending and cash flow chains have stopped in America and the market is still pumping. There should be some red flags going off right about now.

Specifically, the continual printing of the U.S dollar which is subtly becoming less and less valued intrinsically across the world. If you ask most countries in Europe and Asia, they would have away with the U.S dollar all together. Enter crypto and stable coins.

Crypto Could Become the Top Accepted Currency Globally

This is a long shot, but over time and with new gateways to do so, crypto could slowly sneak into the spotlight as some of the world’s top countries teeter with this economic downturn looming. Although, we will not know the full impact of this world wide shutdown for many months, some speculate that the impact could spiral the world economy into another depression.

With America already losing ground on world wide influence and a looming depression, it would not be hard to see areas of the world like the E.U and eastern Asia move to more advanced currencies for cross-border settlements, and better security for their large reserve structures.

These currencies could look like the proposed Libra or Zuckbuck or it could look like China’s proposed stable coin. Although, with the developments of Covid, we are hearing less and less about these projects as the world turns a blind eye to their continual development.

Regardless of which currency wins out in specific regions, it opens the doors for coins like Bitcoin and Ethereum to enter into the market. Not in the traditional sense of spending and using, but in holding as a store of value. You see, Bitcoin could easily be exchanged for large sums of these stable coins and represent a decentralized “fund” if you will of the value for all of these highly used stable coins.

Bitcoin would then in turn become the focus for banks and large companies alike.

Bitcoin in the Future

This is all assuming the world continues to slowly move away from traditional currencies like fiat. We already know countries are tired of the U.S. dollar, so this is a likely scenario.

As the market grows for crypto, and the world starts opening up new avenues for investments, Bitcoin will become more scarce and concrete. Although, Due to this the changes that will be implemented to Bitcoin core will become extremely rare, and governments will slowly start to manipulate the mining facilities to gain control. This will of course cause a power struggle over the network which anyone could win. Ideally, the mining would stay decentralized, but that is entirely up to the world to decide.

In the event that bitcoin mining does stay decentralized, Bitcoin could look to reign supreme as the stable currency for reserves and governments alike. Large settlements will be converted from the regionally used stable coins into Bitcoin and sent via encrypted gateways across secure nodes for protection. Bitcoin will in essence become the gold of the future. Scarce, reliable, and sought after. This will be extremely useful as we move into space colonies in the next 100 years as well.

What If the World Chooses Fiat

There is another side to the argument, and that is what if the world chooses fiat?

In the most likely scenario, the world probably won’t. We are progressing too fast to continually rely on an outdated monetary system. The idea of fiat will become silly as more and more wealth is created around the world, we inhabit other planets, and the population continues to increase in need and transaction speed.

Fiat is just too slow to truly allow us as progressing beings to move forward. Eventually it will have to be replaced with a more suitable solution to fit our constantly moving lives and finances. Likewise, the reserves of the world will have to start being more adaptable as we reach 24 hour markets and constant world trade. Right now there is some down time with markets and time-zones, but eventually this will not be the case with inter-planetary trading and people living in space.

There will be no time for the money to rest. It must be active, live, and able to move at the speed of humanity.