Jim Reid, a research strategist at Deutsche Bank, recently attributed the potential for crypto-currencies to experience the decade of outbreak in the 1920s of the 21st century, according to a report by Bloomberg. By this he means a significant increase in value that could happen to the crypto currencies.
Reid justifies this with emerging doubts about the sustainability of state-supported currencies. The added inflation could increasingly drive people to digital assets, he wrote in the bank’s “Imagine 2030” report on 24 alternative ideas for the next 10 years.
The forces that have held the current FIAT system together now look fragile and could dissipate in the 2020s. If so, this will lead to a backlash against FIAT money and boost demand for alternatives such as gold and crypto currencies.
Cryptocurrencies as an alternative
Not only Deutsche Bank has concerns about the current system. Time and again, experts warn of a possible collapse of the financial system. Many financial experts see no more room for manoeuvre for the central banks, as interest rates are already at zero and below anyway.
Crypto currencies like Bitcoin have no inflation. To be more precise, there is a limited amount. Until then, the growth rate decreases steadily until it goes to zero and the limited amount of coins is dug out. There are heated discussions in the crypto community about whether a crypto currency like Bitcoin could become a global currency or whether it could serve as a value store. In any case, Reid sees the days of FIAT money soon counted.