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Btc is a genuine intranational and international currency in the developing world. It is more trustworthy than many sovereign currencies. The fx applications of
by fwungy 3y ago
Btc is a genuine intranational and international currency in the developing world. It is more trustworthy than many sovereign currencies. The fx applications of btc alone are enough to grant it legitimacy and fx is a the biggest of all the markets. In a de-dollarizing world btc is a genuine factor.
The stable coins are an issue but stable coins aren't a necessity for btc transactions, they're a utility for traders. Btc's biggest danger is its price volatility. As it increases in value and market cap it will become more valuable to large players who will in turn be motivated to protect its integrity.
- andsoitis 3y ago> In a de-dollarizing world btc is a genuine factor. In practice, dedollarisarion has been about shifting to other major national currencies, like the yuan. Bitcoin doesn’t really feature. https://en.wikipedia.org/wiki/Dedollarisation https://en.wikipedia.org/wiki/Dedollarisation
- fwungy 3y agoIt doesn't need to handle much to be a large market because international trade and foreign exchange are so huge. If btc replaces 1% of fx it's doing $50B/day of transactions. Market cap of btc is only about $600M, so 100x btc is not crazy. Is a p2p transaction system with an auditable record attractive to 1% of fx transaction parties? Seems reasonable, especially when corrupt states are a counterparty.
- andsoitis 3y ago> especially when corrupt states are a counterparty how does the integrity of your counterparty to a transaction affect the currency or medium of exchange you agree to?
- fwungy 3y ago>make agreement with company in developing world >how do we get the payment? > a) accept their local currency? where? what then? what will it be worth by the time we exchange it? > b) take btc. transaction registers publicly on the blockchain. smart contracts can execute if desired, e.g. when payment x is received to address y initiate a sequence that starts delivery. currency risk is now in btc and that can be instantly mitigated by converting to your chosen currency, as the btc market is liquid. > c) require counterparty to pay in your currency, which means they pay exchange fees, increasing their costs.
- tasuki 3y ago> Market cap of btc is only about $600M Isn't it $600000M ?
- zaphar 3y agoIf your nation's currency is so mismanaged that Btc looks like an appealing alternative that says more about your nation's monetary policy than it says about Btc.
- fwungy 3y agoThere are plenty of developing countries where people don't trust the government currency and use alternatives. It's quite common in Africa where many transactions were done in USD.
- dennis_jeeves1 3y ago>There are plenty of developing countries where people don't trust the government currency. Same for developed countries, though on a small scale.