Cryptocurrencies and “Crypto Dollars” are no longer a passing fad as the narrative has been for the past 3 or so years, with the US Dollar increasingly losing its shine to the two.
In a trend that has been on the rise, while cryptocurrencies, notably Bitcoin, Ethereum, Cardano, and stablecoins seem to have outshined themselves in terms of value and transactional efficiency, the dollar has only lost its shine thanks to inflation and its centralized nature.
Now, experts are warning of even more dire consequences for the greenback in 2022, with most feeling that Bitcoin, Ethereum, Cardano, and stablecoins could ultimately lead, not only the dollar but also all fiat-backed assets as crypto adoption continues to surge.
“Crypto-assets exemplify global free-market capitalism, and a top winner has been the dollar, says Mike McGlone, a Senior Commodity Strategist at Bloomberg before adding, “Bitcoin, Ethereum, and crypto dollars are poised to stay atop the ecosystem vs. about 16,000 rivals jockeying for speculative leadership.”
According to a recent report by Bloomberg, the pundit paints a picture of “an enduring upward trajectory of the market cap of crypto dollars alongside Bitcoin and Ethereum.” His argument for this assertion is anchored on the success at which crypto dollars have eased transactions around the world.
“The ability to transact and transmit dollars around the clock with instant settlement, and to earn interest well above eurodollars, are attributes of crypto dollars… This has buoyed the greenback and trickled down to most financial assets,” he says.
With stablecoins such as tether’s transaction volume exceeding that of Bitcoin and Ethereum combined according to CoinMarketCap, McGlone further believes this only points to the bullishness of crypto dollars, noting that the shift to transacting via digital tokens “may be unstoppable”.
He adds that while there is plenty of speculation and hype around newer cryptocurrencies including Solana and Shiba Inu, the top three coins which now include Cardano could maintain their dominance for the rest of the year.
A statement by FED’s Powell in a sitting last week, stating that private stablecoins could co-exist with the digital dollar has been taken as being bullish for stablecoins.
With the tension between crypto chiefs and regulators easing, crypto regulations could soon start rolling out, creating a better environment for authentic crypto projects to thrive.