Spoiler: it doesn’t need to in order to be widely successful. Cryptocurrencies have experienced rapid growth in value, utility, and popularity over the past couple of years, and we continue to see them creep into the mainstream slowly, but steadily. With , the door to all the possibilities that crypto has to offer beyond being a new, digital asset class has opened, and one crucial question comes up time and time again. Ethereum Can crypto ever a major currency? replace I’m Karen, the CMO at Fiat24 and this is my controversial opinion — no, crypto will never replace a major currency (and nor does it need to in order to be widely successful). What Crypto do well does As digital advancements helped us make the switch from physical currencies to electric methods of making payments (and even relying more on debit and credit cards rather than bills and coins), we have transitioned into a dependency on third parties to carry out our transactions. The issues surrounding trust are nothing new, with violations and unethical practices having contributed to various global financial crises. One thing that crypto do well is to meet those needs by eliminating the need for another person to verify transactions, and by ensuring a higher level of accuracy. does Crypto also has the potential to do good in developing countries with unstable fiat currencies, or where people are simply unbanked and unable to access traditional financial services. Yet another positive is that crypto transcends borders and regulations, remaining uncontrolled or influenced by central banks the way that fiat currencies are in developed countries. Despite all of these advantages — among many others — I don’t believe that crypto will ever be able to replace fiat. Why Crypto will not replace fiat Brian Brooks, the CEO of bitcoin mining and crypto tech company Bitfury Group, said in a recent CNBC , that “…it’s not that Ethereum or Ripple or anything else is trying to replace the U.S. dollar, it’s trying to replace the system of transmitting value.” And that is an interesting thought to sit with. article If we look at the fact that every economy is built on its government’s control over its currency, we can already identify one glaring reason why crypto will never replace fiat money. From the crypto investor perspective, most tend to look at is a means to invest money and grow it quickly, rather than as a payment method. A large portion of crypto players prefer to HODL and hoard and still rely on fiat cash for spending. As Frances Coppola wrote for Coin Desk, “…the present pandemic has increased , forcing the Federal Reserve to provide more liquidity to financial markets. Even in crypto markets, there is a growing need for greenbacks — after all, what are stablecoins but a means of tying cryptocurrencies ever more tightly to the dollar? A global switch to bitcoin would cause the mother of all financial crises, destabilizing not only conventional markets but crypto markets, too.” reliance on the dollar Why it doesn’t need to The good news is, whether you are a crypto enthusiast or not, that Bitcoin, Ethereum, Ripple and so on are likely to remain parts of our lives in future -as money, investment options, commodities, assets or some other form. Cryptocurrency can benefit people worldwide and the economies that surround them. Whatever the fate of fiat, cryptocurrency will always be a useful means of exchange, unit of account, and store of value. Even if it never replaces the dollar, for example, crypto will never cease to have a stronghold and an impact on the way we move ever more into a digital world for our finances and investments. Also published here.

Ethereum

Read My Stories

Too Long; Didn't Read

Build JavaScript Blockchain Apps Easily with Lisk!

Crypto Will Never Replace a Major Currency (and It Doesn’t Need To)

Too Long; Didn't Read

Coin Mentioned

@karenshidlo

RELATED STORIES