- >Opinion: Bitcoin is the Next Currency Superpower
Opinion: Bitcoin is the Next Currency Superpower
The next superpower currency to take over the world is a tossup between four world currencies. The USD is assumed to be the current world superpower currency. The other three competing currencies each have their own unique advantages that could win them the currency war. The second currency in the running, is the Chinese Yuan. The third, is a currency that represents the interests of businesses. The fourth and final currency is bitcoin.
Keegan Francis | Oct 13, 2020
This article is inspired by a podcast by Anthony Pompliano, a prominent Bitcoin advocate, blogger, podcaster, and investment fund manager. Anthony states that bitcoin is the next currency superpower.
The Fall of the USD
Historical context can help in determining exactly when the USD will cease to be the dominant world reserve currency. All other major reserve currencies had an average lifespan of 100 years. From the Dutch florin, to the British pound sterling, it seems that world reserve currencies follow similar patterns shortly before their demise. There are three omens to look out for when trying to spot the fall of a currency.
- Increased Reckless Government Spending
- Easy and increased access to credit
- Sanctions on Free Trade
If you’ve been paying attention to world news, then you know that the US debt clock has just reached 24 trillion dollars. One trillion of those dollars are owed to the Chinese government, who the United States has been in a full fledged trade war with since 2016.
The Rise of CNY
The Chinese Yuan may be the obvious choice for the next world superpower currency. The Yuan was given the status of a reserve currency in 2015 but the International Monetary Fund. In 2016, the Yuan was added to the IMF’s special drawing rights. This is a basket of currency that the IMF is able to loan to other countries. This fund is made up predominantly by the USD, but also contains the EURO, the Japanese Yen, and the British pound. One of the main indicators that China is taking its place as an economic superpower, is that since 2009, they’ve been the largest exporter of goods. If the Yuan were to become the next superpower, it would first need to be held by all central banks. American economist Jeffrey Sachs states that we could see the Yuan on equal footing with the USD within the next decade.
The Business Coin
Facebook’s project Libra is the first iteration of what we are dubbing “The Business Coin”. This is a hypothetical currency that serves the interests of businesses. Libra is proposed to operate as a stable cryptocurrency, pegged to the USD. The coin will be controlled by a hegemonic group of international conglomerates. The organization behind the scenes is called Calibra, where Facebook holds just a single seat at the table. Ninety nine other companies would buy a seat at the table. A seat would earn them the ability to vote on the direction of Calibra and its underlying cryptocurrency. Earlier members of Calibra include Facebook, AirBnB, eBay, Spotify, Uber, Coinbase and many more.
The project was met with swift and decisive action from many world governments and privacy regulators. The concern being that Facebook has already been at the forefront of several privacy scandals such as Cambridge Analytica. Facebook should not be the arbiter of a currency that is seperate from the authority of the government. Many have used Libra as an opportunity to explore the notion of separating money and state. I personally agree that money and state should be separated. That being said, I am not comfortable with placing the reigns of the new global monetary system in a group of private companies. Companies are beholden to their shareholders. Their interests are consumeristic, and capitalistic in nature. The new world currency is one that should be unbiased, and truly serves the interests of the people. If a coin such as Libra were to exist, it is not difficult to summarize the ways in which the currency could be used to further the interests of the businesses involved, rather than the people using the money.
The Peoples Currency
There are several compelling factors of bitcoin that make it fits squarely inside the role of being a peoples currency. Bitcoin is unbiased with who it provides service to. Most of our current monetary systems give preferential treatment to those who already have money. Bitcoin sits squarely outside the jurisdiction of any one government, allowing it to embody the best aspect of the internet. Decentralization, and censorship resistance. Finally, the creator of bitcoin is an anonymous individual or group of people. This fact allows us to use a currency without feeling like we’re beholden to the values of its creator. In the case of government money, or a cryptocurrency created by Facebook, we’re somehow attached to the actions and beliefs of the entities at the top of the hierarchy. In the case of bitcoin, there is no hierarchy.
Bitcoin’s finite supply of 21 million coins also harkens back to a time when the world’s monetary system was backed by gold. This has led many to speculate on whether or not bitcoin could bring in a new era of backing our money with digital gold, aka bitcoin. Although bitcoin may not emerge as the victor of the currency wars, the future of money is in frictionless, bias-less, value exchange.
My Vote is for Bitcoin
Cryptocurrency is the monetary wild card that no one saw coming. The future world currency will be a cryptocurrency. The ability to transfer money anywhere in the world is an innovation only rivaled by the ability to transfer information (the internet itself). We now live in a global society, as the internet dampened the borders between us. It is only logical that the next step we take as a global society, is to create an internet based money that serves the interests of the people. After the previous economic crisis of 2009, the UN has stated that we need a new global currency. We need a money that unites the people of the world, instead of the people of a country. The currency that currently best fits the description of a “people’s currency” is bitcoin. Bitcoin is the next currency superpower. If you truly do vote with your dollar, then my vote is for bitcoin.