Cryptocurrency

Deutsche Bank: Fiat Money is Fragile, Crypto – Inevitable

Deutsche Bank: Fiat Money is Fragile, Crypto - Inevitable

The forces that hold the fiat money system together look fragile and, over the next decade, some of these forces could begin to unravel and demand for alternative currencies, from gold to crypto, could take off, German banking giant Deutsche Bank said in its recent report Imagine 2030.

"While critics bemoan cryptocurrencies as constrained by regulatory hurdles, we believe the incentives of governments and card providers are such that digital currencies are inevitable," the report prepared by Deutsche Bank Research said, adding that it would not be surprising if a new and mainstream cryptocurrency were to unexpectedly emerge in the next decade.

While cryptocurrencies have not managed to take off as a means of payment despite their well-known benefits, such as security, speed, minimal transaction fees, ease of storage and relevance in the digital era, this may change in the next decade. Assuming governments back cryptocurrencies, and consumers want them, and if current trends continue, there could be 200m blockchain wallet users in 2030 and crypto might eventually replace cash, the researchers estimated.

We have lived in an era of fiat money since the early 1970s. Since then virtually all money in existence has only had a value based on trust and, in particular, trust in governments’ ability to maintain its value. Prior to this period, most of the money in existence through history was backed by a commodity – usually a precious metal like gold or silver.

Meanwhile, a survey has found that less than one-third of the surveyed Japanese citizens are in favor of mainstream cryptocurrency adoption. Per App Times, the Japanese Ministry of Education surveyed some 3,000 citizens, 82% of whom said they wanted to see more advances in robotics. 80% of respondents said they wanted a future where 5G telecoms networks played a key role. But only 30% of the respondents, all aged between 15 and 69, said they saw a key role for cryptocurrencies in the future.

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