Can Bitcoin Destroy the Dollar?

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Since it launched in 2009, Bitcoin has been rallying like nothing else. While highly volatile, it has managed to break records constantly, making experts wonder if it can end the dollar’s reign. The US Dollar is one of the biggest currencies in the world, and if expert opinions are to be believed, the cryptocurrency is on the way to ending its supremacy.

There were quite a few contenders threatening the dollar’s status. The Euro was one of them, but it has failed so far. There were high hopes for China’s renminbi too, but it couldn’t move the dollar’s price. Bitcoin might be that hero, seeing as how it’s being used more often in many industries including Bitcoin gambling.

All Thanks to Covid-19

One of the initial sparks that put Bitcoin on a historic run was the still ongoing pandemic. Before the pandemic started, the dollar was as strong as ever. It’s the top medium of international trade, and the anchor against which other nations value their currencies.

Most banks use the dollar as reserve currency. That’s a status that has only been enjoyed by five nations in the history of finances – Portugal, Spain, the Netherlands, Britain, and France. However, the US Dollar is the only reserve currency that has held that position for over a century. Things might have been different if there ever was a successor.

There might be one now in Bitcoin. The leading cryptocurrency is on a massive bull run, replicating the success of the historic 2017. Cryptos, especially BTC, are a massive contender for the dollar’s status in international trade, although there’s still a huge way ahead for them.

First and foremost, cryptocurrencies are not even legal in many countries. Second, a new infrastructure has to be developed for the world to use them as easy as it does with the dollar. Third, several questions remain about their price volatility, which is the reason why doubters don’t feel safe investing in BTC. The daily price swings are larger than gold, but still, the numbers of crypto adopters are rising.

A Turning Point for the Dollar

Skeptics are much more inclined to gold compared to cryptocurrencies. After all, they didn’t grow up with cryptos, and were taught to invest in gold as protection against the decline of fiat money. However, the number of crypto adopters is rising, especially among the younger generations.

2020 has been a massive turning point for the dollar. Just last year, the US national debt went over the 50% threshold. That usually signifies a coming crisis. With the ongoing coronavirus pandemic, things have turned worse. The world is losing confidence in fiat money and especially the dollar, and many countries are shyly, but surely, opening the door to Bitcoin and cryptos.

Online merchants are desperate to make a buck these days, and many have implemented crypto payments in their stores. The confidence in Bitcoin is further reinforced by the cryptocurrency’s rising price which has been soaring in the last few months.

The dollar’s reign may soon be coming to an end, and there’s a new king waiting to be crowned. We’ll keep you updated on the coronation.

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December 9, 2020: • No Comments

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