Bitcoin continues to garner headlines and now it is also receiving attention from US President Donald Trump.
In a series of tweets on Twitter, Trump spoke out against Bitcoin and Libra - Facebook's currency.
"I'm not a fan of Bitcoin and other digital currencies, which are not money, have a volatile value and are based on thin air," he began. "Unsupervised cryptocurrencies can be used for illegal conduct, including drug trafficking and other illegal activities."
"Similarly," he continued, "Facebook's virtual currency, Facebook, will have low grip and reliability. If Facebook and other companies want to be a bank, they must act in favor of a new banking license and be subject to the entire banking regulation, just like the other bankers, both national and international. ”
In the last few weeks since Facebook announced the launch of the Libra currency, criticism from regulators and governments around the world has continued to flow and very aggressively. It was only a matter of time before Trump had to address the issue himself, and of course he expressed the expected position.
He ended the series of tweets with a description of the strength of the dollar: "We have only one real currency in the United States, and it is stronger than ever, both reliable and trustworthy." It is the dominant currency in the world by a wide margin, and will always remain so. It's called the US dollar! ”
With the fact that the dollar is still considered the strongest and most dominant currency in the world can not be argued. There is hardly a country or company in the world that will not accept it as a means of payment in trade transactions. It's just a pity he ignores it in the last decade alone the dollar has lost about 20% of its purchasing power due to irresponsible printing of money, while increasing US debt almost threefold.
Bitcoin of course has value. A value based on trust, or rather the lack of need for trust when it comes to money. The fact that Bitcoin does not have a single controlling share or one central point of failure or another is what gives it the ultimate value of digital gold, as the Federal Reserve Chairman Jerome Powell himself referred to it.
Fed Chairman: "Bitcoin is perceived as a means of preserving value, like gold"
At the Senate conference this morning, Jerome Powell, chairman of the US Federal Reserve, was asked the following question: "If a digital currency system were to be widespread around the world, would it reduce or eliminate the need for reserve currency (in the traditional sense)?"
At the beginning of his answer, Powell did not surprise those sitting in the room: “I think such things are possible, but we do not really see them. Do not see widespread adoption, and Bitcoin is a good example of this. Really almost no one uses Bitcoin for payments. They use it more as an alternative to gold. It is a means of maintaining value, speculative, like gold. ”
The fact that the chairman of the Federal Reserve sits on a committee in the Senate and says that bitcoin is perceived as a means of preserving value is of immense importance, and may light many bulbs for those who flock to gold during an economic crisis, as is beginning to happen these days. Beyond that, many central banks hold gold as a reserve for the purpose of maintaining value, and may now consider Bitcoin as an alternative.
“People have been talking about it (about Bitcoin as a means of preserving value) since digital currencies were created, but we have not seen it. However, this does not mean that we will not see it, and if we do see it - yes, we may see a return to an era in the US where we had many types of currencies - in the era of "national banking".
To me, the race for the first adoption of Bitcoin by central banks has long since begun. Although the Bulgarian government, for example, is known as a major bitcoin holder (after boycotting quantities and deciding not to sell the currencies), central banks - especially in developing countries - are beginning to understand a number of key things.
Bitcoin is increasingly emerging as a substitute for gold (at least) as a means of maintaining value.
If it does replace gold, or take over part of its market value, it is expected to grow significantly (hundreds if not thousands of percent).
The first central banks to adopt Bitcoin as a reserve for backing up local currency will take a big risk - but depending on the risk, so too can the potential return help save the local economy.
The first central banks to adopt Bitcoin will give legitimacy to other central banks to adopt it as well, and start an adoption race when each new entrant reduces the risk and return for subsequent joiners.
When you combine the element of economic incentives with the dismal economic situation of most countries in the world, from the most (economically) failures such as Venezuela and Zimbabwe, through the weakening eurozone to the false growth presented by the US economy while pumping financial markets with fictitious money That this scenario is not so detached from reality.
for more posts check my blog.
