Jim Reid, the lead strategist at Deutsche Bank recently claimed that the fiat-based currency system operating presently is at the verge of its end. He also feels that the system has managed to last this far due to the major disinflationary move taken in 1980s. A recent report established Reid’s stand on the present fiat currency structure stating that it is running in reverse gear as of now which is expected to have a deep-rooted impact on currencies operating round the globe.
He added that strategies such as continuous printing of money, extensive leverage and loose policies might actually bring about the downfall of the paper currency. With fiat currency losing it value with time, consumers shall also lose faith on the same. Reid agreed to the fact that virtual currencies hold the potential of mitigating the risks of financial collapse as a result of which it needs to be promoted all the more.
However its inherent nature based on a decentralized architecture keep such currency forms away from the control of any central authority. They can be regulated as per the country’s organic laws especially those in regards to demand and supply. He was quoted as saying:
“Although the current speculative interest in cryptocurrencies is more to do with Blockchain technology than a loss of faith in paper money, at some point there will likely be some medium of exchange that becomes more universal and a competitor of paper money.”
Various other bigshots have also voiced similar concerns as that of Reid. Significant among them is the Turkish Central Bank’s president who feels that cryptocurrencies can bring financial stability to any and every nation. However he also agreed to the fact that risks are a part and parcel of the entire virtual currency package.
Peter Thiel, the Co- Founder of PayPal also supports Bitcoin. The Billionaire investor feels that Bitcoin critics are “underestimating” the “great potential” of this cryptocurrency which might as well become the “cyber equivalent of gold” if nurtured properly.
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