- The traditional financial system is at the brink of extinction as more billionaires around the world add Bitcoin to their portfolios.
- The cryptocurrency market continues booming as trust erodes for the world's reserve currency.
The growing level of interest in Bitcoin from high net worth individuals have become too significant to neglect. Although the pioneer cryptocurrency is at nascent stages, more investors are buying into the store of value narrative.
US dollar's woes are only beginning
The question about the need for the US dollar as a reserve currency has been on the minds of many thought leaders in the traditional financial space. The CEO of BlackRock, Larry Fink, believes that a decentralized digital currency poses a threat to the global financial system.
While Bitcoin continues to rise in value, some of the most prominent sovereign currencies are losing their purchasing power. For instance, goods or services that were priced at $1 in 1700 would go for about $53 today.
The purchasing power of the US Dollar
Fink's endorsement adds to the expanding list of billionaires like Stanley Druckenmiller and Paul Tudor Jones, who have made bets on Bitcoin's success as they see it as a hedge against inflation.
Bitcoin thrives during times of uncertainty
The current economic structure as it is known might be on the brink of extinction. The growing interest in the blockchain industry is making banks as well as paper notes obsolete. There is no longer a need for a global reserve currency as digital assets, such as Bitcoin, enter the monetary system.
Governments have begun to discuss ways to digitize fiat currencies in a desperate effort to retain their relevance in the financial markets.
Speaking at the council of foreign relations, the former governor at the Bank of England, Mark Carney, acknowledged the shortfall of fiat compared to digital currencies.
"One of the accelerants of Covid and the experience of a big shift towards has been to reinforce the importance of the innovations that have happened and further innovations in the payment side. At the heart of that will be a move towards central bank digital currencies," said Carney.
Monetary sanctions like the ones imposed on the Chief Executive of Hong Kong, Carrie Lam, make a case for the need for a decentralized digital currency. Lam affirmed that the US had cut her off from the global banking system, forcing her to keep "piles of cash."
In the meantime, Bitcoin has not only gained a substantial amount of value against the US dollar, but it has also outperformed every other asset in the traditional financial markets, including gold. If this trend continues, some of the industry's most famous technical analysts maintain that BTC could go as high as $300,000 in the coming years.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Is Altcoin Season here as Bitcoin reaches a new all-time high?
Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.
Shanghai court confirms legal recognition of crypto ownership
A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.
BTC hits an all-time high above $97,850, inches away from the $100K mark
Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Bitcoin: New high of $100K or correction to $78K?
Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.