Will Bitcoin Ever Replace Fiat?

4 November 2019 0 minutes read
Will Bitcoin Ever Replace Fiat?

“A nickel ain’t worth a dime anymore.” The human civilization grew from barter system to money and now with the amaze of technology to digital currency. Human civilization has had revolutionary growth.

It’s like going back in the 80s, whether the laptop would ever replace the computers. However, the answer is still a little complex but pretty obvious in painful ways. The American fiction writer, F. Scott Fitzgerald said, “The test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function.”

Fiat and Bitcoin have been the talk of the show for a very long time now, it seems to be an ever-longing process. Aleksander Berentsen and Fabian Schar, researchers at the St. Louis Fed, wrote that the cryptocurrency can be created 

by the central bank itself however the key feature of cryptocurrency is a red flag to the central bank.

We have jotted down a few theories of pros and cons between fiat and bitcoin:

Fiat

Bitcoin

Fiat money is a currency which is issued by the government and regulated by a central authority.

A Bitcoin is a cryptocurrency that is a medium of digital exchange of virtual currency that uses cryptography with the help of blockchain technology.

Fiat Money is a centralized system.

A Cryptocurrency cannot be manipulated as it is decentralized.

A Fiat Money brings stability, fraud protection and optimizes economic growth, it is controlled by the government.

Cryptocurrencies cannot be counterfeited and has no intermediary leading which helps reduce fraudulently and various additional costs.

Fiat money enables the government to determine the print of currency in response to internal and external handles.

Cryptocurrencies also provide low transaction cost even across borders globally.

Fiat money is a form of currency that is utilized and accepted globally.

Various countries that are in the frame of the developing countries and under-developed countries will be behind the line with this phenomenon.

John Williams, the President, and CEO of the Federal Reserve Bank of New York stated, “Cryptocurrency doesn’t pass the basic test of what a currency should be.”

While the CEO of Twitter, Jack Dorsey, recapitulated, stating that the bitcoin is a great brand and would become a global currency of the internet with the timeframe of 10 years.

 

Fiat money holds assets in various aspects to sustain, moreover people have become comfortable with the concept and utilisation of fiat money. While in cryptocurrency one has a complete control over its funds but also people may not be too comfortable with using cryptocurrency as the technology behind it is too techy and it might create a scenario of anxiety. Predicting cryptocurrencies is a tough call as it is volatile but also considering the change in the market value of fiat money is incalculable.

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Hence, fiat money is a legal tender that has been declared and accepted by the government across the world while cryptocurrency is yet not definite across by vary in the theories of its existence.

Cryptocurrency as a transaction system has played a fundamental role in the essence of the utilization of fiat. It is an emerging state which is a notable concept of currency just like how it evolved from money to digital money transactions. Probably the existential cryptocurrencies may have flaws but with the growing technology and improvisation a new cryptocurrency can change miles. It could be a possibility for the generation to be using the next big thing.

Will Bitcoin ever replace a fiat? It is an argumentative question of debate!

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