Crypto

Bitcoin, According to This Executive, Will Soon Become the Worldwide Reserve Currency

bitcoin cryptocurrency

Bitcoin, the world’s most valuable cryptocurrency, is currently on a tear. The global banking system could be disrupted by Bitcoin and other major cryptocurrency ventures. Bitcoin (BTC) is portrayed as having the power to battle central banks and Wall Street over the creation and control of money. BTC, on the other hand, still needs a few renovations to attain this position permanently.

Avanti Bank & Trust’s Founder and CEO, Caitlin Long, shared her perspective on the subject. “At some point, Bitcoin will be recognized as a global reserve currency.” Nonetheless, it will take a long time. Let’s have a look at how;

Many BTC supporters believe cryptocurrency is a deflationary asset that will soon overthrow the US dollar. She warned about deflation, as well as inflation, and said she anticipates a seamless transition.

This could lead to a reaction from central banks that is excessive.

BTC vs. the rest of the pack

The Wall Street veteran gave the ideal opportunity to highlight Bitcoin’s importance. A BTC transaction can take anywhere from 10 minutes to an hour to complete on average. In comparison to the situation described in the interview, BTC would be of great advantage.

Situation: A $29 billion transfer of pension liabilities and assets from General Motors’ pension plan was involved. Given the laws and regulations inside the intermediaries, the claimed transfer took roughly 3 days to be processed. However, with Bitcoin, that transfer can be completed in as little as one hour. “What we have at the moment is not fair and stable”, she said. Bitcoin will help us get there.

However, Bitcoin is not without its flaws. She expressed her opinion as follows:

“There are aspects of Bitcoin markets that aren’t fair or consistent. I’m opposed to some of the fractional reserve lending practices we’re witnessing in the Bitcoin lending markets.”

Adding to the understanding of circulation credit and commodity credit. “It’s fantastic that there’s a market for up to 1:1 leverage.” However, once you exceed 1:1 leverage, you’ve crossed the line into producing more claims to the asset than there are real assets.” The main objective is to introduce a run-risk into the system.

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Governments all around the world have kept their stance on crypto laws ambiguous. “One place where the government should actively get engaged,” Long stated, “is to abolish fractional reserve banking and the Bitcoin market.” To establish a real interest rate curve, absolute property rights are required. We don’t have that right now in Bitcoin because there are so many fractional reserve intermediaries.”

The earlier mentioned attributes raise not only Bitcoin’s price volatility but also the cost of financing for everyone involved in the business. People throughout the world would feel more at ease interacting with Bitcoin if this problem could be settled.

Curiosity

The interviewee is generally positive about the flagship token. Particularly in light of recent advances like the Lightning and Liquid networks. ‘That’s how I envision Bitcoin scaling, and it’ll be a high-value transaction system like central bank money,’ says the author.

Central bank money addresses a specific set of issues, such as high transaction costs, inefficiency in terms of cost, time, and technology.

“Bitcoin is the Bitcoin system’s base central bank money, followed by Lightning and Liquid, which are scaling technologies more akin to commercial bank money.”

To challenge the US dollar system, however, a lot of “technical effort” is still needed. But she appeared to be certain that it would occur shortly.

“I believe it is on its way.” It is unavoidable. I’m interested in achieving the fair and stable financial system that Bitcoin, in my opinion, will bring us to, while minimizing the risk of a chaotic transition.”

Deutsche Bank produced a similar analysis with the same findings not long ago.

The Author

Samuel Adeshina

Samuel is a financial reporter whose interests include blockchain, market, business, insurance, and Crypto to provide relevant information to all interested.