The One Simple Reason Bitcoin, Ethereum, And Other Cryptocurrencies Will Not Succeed
I have a fairly short, quick, post today. I began really thinking about this a few weeks ago and shared my initial thoughts on the Millionaire Money Mentors forum. I’ve always been a bit skeptical of Bitcoin, Ethereum, Dogecoin… all the “random” cryptocurrencies, because they are all “made up” wealth values. Yes, I know all the economic basics that ANYTHING can be a storage of wealth. Even gold, the dollar, blah, blah, blah are just storages of wealth.
But I said this was going to be a short, quick, post, so here’s the one simple reason…
Major World Governments Are NEVER Going To Give Up Their Financial Power To Control Economies
Do you think the US is going to give up control of the dollar ($) and being able to print money whenever it wants? No major government is ever going to give up that control. In the US, if Bitcoin was allowed to thrive independently, and it grew large enough, enough people were using Bitcoin and not using the US dollar anymore, it would DESTROY the value of the dollar. And once the dollar is destroyed, the government would not be able to control much of anything. It definitely wouldn’t be able to control inflation and cheapen it’s own debt by printing money (in general when you print money, it devalues the existing money’s value a bit — good for the government, bad for you).
Now, fans of Bitcoin and the other cryptocurrencies would tell you that’s WHY Bitcoin needs to succeed. They would say Bitcoin and others would give you a STABLE storage of value, because it wouldn’t (and maybe couldn’t) be “printed” on the government’s whims. That may be true, but it’s not going to be allowed. No way.
So What Will Happen With Cryptocurrencies?
I believe each world government will creates it’s OWN cryptocurrency. For example, the US will have one that is tied to the dollar. The US may eventually transition all dollars to the crypto version. Maybe in 20 years, there is no more printed money. And then eventually, with each country having it’s own cryptocurrency, money will move from country to country kind of like it currently does with global exchanges.
That’s it. I told you it would be short.
Permit me to issue and control the money of a nation, and I care not who makes its laws!
Mayer Amschel RothschildThe government will never give up control of its currency.
Mr. Hobo MillionaireMayer Amschel Rothschild knew it way back when, and I’m repeating the same thoughts now in relation to cryptocurrencies. So, what say you?
You speak to what I refer to as nations control the currency through their own might/violence. So long as it is seen as the recommended tender, any challenger currency will be treated with impunity and violently opposed or IRS involvement. I agree with you there, definitely think that the US government will want control over it’s own currency.
Where I see a potential for crypto is the countries that have a worthless local currency (as seen by its own people), there may be a shift to a better currency – something that Satoshi referred to as the speculative attack. With sovereign nations defaulting on debt I see that as a possibility, especially post bank failure.
Those individuals would need to choose what the alternative currency is. At present many use USD. There might be a case for something else, but of course it depends whether those countries even have power/internet to use something like crypto. Having been to a few African nations, the MPesa mobile money is interesting, and despite not having regular electricity, many may utilise something like crypto instead of USD. Crypto could gain a real foothold should multiple countries start to topple. I’m just not 100% convinced it won’t be the USD. Rumours of the USD’s demise are greatly overstated – and I say this as a non-US person.
>>Rumours of the USD’s demise are greatly overstated
Haha. Yep. Very true, Charlie.
You may be onto something:
https://www.politico.com/news/2021/06/12/fed-remake-us-dollar-493548
“The Federal Reserve is taking what may be the first significant step toward launching its own virtual currency, a move that could shake up banks, give millions of low-income Americans access to the financial system and fortify the dollar’s status as the world’s reserve currency.”
You can take that to the bank, J. Money (so to speak). Haha. Thanks for dropping by!