Can crypto actually take on USD’s role around the world?
Jim Bianco, CEO and president of economics and finance analysis company Bianco Research, said he sees a cryptocurrency as the next reserve asset.
“I’ve argued that, in theory, the next reserve currency will be a crypto,” Bianco told Anthony Pompliano on an April 17 episode of Pompliano’s podcast. Biano noted that no other global fiat option would work as a U.S. dollar replacement.
The U.S. dollar is still the reserve currency
In light of recent economic difficulties related to the COVID-19 pandemic, Bianco noted people have fled into the U.S. dollar with their wealth as the world still largely views it as a reserve currency. Gold and oil, for example, see prices listed in terms of USD around the world.
“Ninety percent of the world is in dollars,” Bianco said. “If you are Chinese, and you want to do a trade for Brazillian timber, you’re quoting the price and paying for it in dollars, is what you’re doing most of the time.”
The search for an alternate reserve currency
In light of coronavirus measures being taken around the world, Pompliano raised the question of whether or not people will start looking beyond the walls of government and traditional mainstream structure for an alternate reserve currency.
“I think they’ve been desperately looking for one for 10 years,” Bianco said. He added that no other fiat currency will suffice as a replacement for the U.S. dollar.
After suggesting a crypto asset will be the next reserve currency, Bianco said Facebook’s Libra looked like a contender at one point, although his view has since changed. He also pointed out the huge governmental backlash that Libra faced, as the digital currency system potentially threatened the current system.
The world likely doesn’t know the asset yet
“It probably doesn’t exist yet,” Bianco said, regarding the hypothetical crypto asset to become a suitable reserve asset. “It needs to be both a medium of exchange and a store of value.”
He also said he thinks the asset will exist outside of governmental control.
Source: , CoinTelegraph
Articles listed with Cash Tech News as the author are either general information, or may have been imported from another website, to bring our readers a rich media experience that encompasses articles that we find interesting, as well as those curated by others.
The views and opinions expressed here are for informational purposes only, and should not be confused with professional financial advice. These opinions are solely those of the author and do not necessarily reflect the views of CashTechNews.com. Every investment and trade involves risk. You should conduct your own research, and contact your professional financial advisor before making any investment.
Corrections, feedback, and ideas should be submitted through the website contact form.