In the next 10 years, the global monetary system may collapse and be replaced by cryptocurrencies
Systemstate (fiat) money is in danger of extinction, and in the next 10 years it can be replaced by digital assets like cryptocurrencies, warns Deutsche Bank.
Doubts about the reliability of the usual statemoney and the permanent threat of high inflation open up great prospects for cryptocurrencies, experts at Deutsche Bank write. In their report “Imagine the Year 2030” they offer 24 ideas for the next 10 years.
“Forces that previously held the systemfiat money (ProFinance.ru: money unsecured by gold and other precious metals, the nominal value of which is set and guaranteed by the state, regardless of the cost of the material used to make them) afloat, now looks fragile, and it may fall apart in the 2020s ” - says you document. “With this scenario, demand for alternative assets, such as gold and cryptocurrencies, will increase.”
According to Deutsche experts, the current situationsimilar to the late 1970s, when the gold-backed Bretton Woods system collapsed. This event provoked a sharp increase in inflation and a rise in gold prices.
Cheap and plentiful in the last 40 yearsChina's labor force was the main force that held back inflation. However, in the future, due to demographic factors, governments will focus more on fiscal policy than on aggressive monetary stimulation.
“As soon as the cost of labor begins to grow markedly,it will become much more difficult for central banks, ”say experts at Deutsche Bank. “And, since politicians are only concerned about elections, it is likely that this will end with global inflation.”
Over time, inflation will become an increasingly serious problem, which will increase doubts about the reliability of fiat money and generate high demand for alternative currencies.
“Will fiat money be able to survive the period of highinflation and record debts? This is a multi-trillion dollar question, the answer to which determines the future of Bitcoin and other digital currencies,” conclude the bank’s experts.
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