With each passing day, there is a little increase in cryptocurrency adoption with more people being informed and special efforts dedicated to education. If a recent Deutsche Bank report is to be believed, the next decade beginning from next year will most likely record significant leaps and bounds as far as the cryptocurrency sector is concerned, ending with fiat currency being regulated.
According to the “Imagine 2030” publication from the German multinational financial services giant, fiat money is slowly getting closer to the brink of complete instability because all of the factors that have been holding it in place have created an imbalance which is already beginning to tell on the system.
In the section of the report dubbed “The end of fiat money?” written by Jim Reid, the analyst suggests that the 2020s will be significant because there will be an increased need for fiat alternatives.
“The forces that have held the current fiat system together now look fragile and they could unravel in the 2020s. If so, that will start to lead to a backlash against fiat money and demand for alternative currencies, such as gold or crypto could soar.”
As unlikely as the end of fiat might seem, Reid argues that back in the 1970s, money was always backed by commodities such as gold or silver. One of the most noteworthy things that happened to fiat after its dependence on such commodities was that inflation sometimes increased “dramatically.”
Reid also argues that a major flaw with fiat currency is that it’s usually a little too tempting to produce money willy-nilly when there is nothing backing it. This is something Reid suggests that alternative currencies will solve because no one can wake up and decide to just create Bitcoin and other digital currencies, out of the blue.
While it might be a little too bullish to expect that fiat will completely fall, it surely is interesting to think about all of the weaknesses fiat has and how alternative offerings like cryptocurrency, could easily step in and save the day.