Is bitcoin becoming a world reserve currency?
It depends where you look
Quote of the day
“Change is the law of life, and those who look only to the past and present are certain to miss the future”
Bitcoin enthusiasts will say bitcoin is destined to become a world reserve currency. Depending on where you look in the world, we are still very far from that. Take for example Alexis Roussel’s, co-founder of the exchange Bity, recent experience in Ukraine and Turkey. He says, in those countries most people want a stable coin in dollars, in other words a digital form of the dollar, that they can store and exchange on their phone. Listen to the podcast here .
However, according to Ray Yousseff, founder of peer-to-peer exchange Paxful, in several Africans countries, people already prefer bitcoin now and use it as their store of value. Listen to Anita Posch's podcast here .
I believe the dollar will remain the world reserve currency for a long time to come, even if its position as such is weakening continually. Bitcoin is too complicated for most people to understand. Bitcoiners like to talk about network effect. The network effect of the dollar is still huge. The British pound used to be the world reserve currency and it still exists today.
On the other hand, you could argue most people don’t understand fiat currency nor the medication they buy at the pharmacy, but they still use it. Furthermore, as Alex Poltorak, co-founder of Hodling SA says, “bitcoin is the only thing your enemy cannot control, so it is the only thing everybody will trust”. Major historical changes often build up slowly and then a sudden unexpected event occurs and accelerates things. The British pound used to be the world reserve currency but WWII put an end to that.
The bitcoin base layer or the lightning network, however, could very well replace the Swift network in the future, but to transact a dollar stable coin.
Keep watching and we will all see.