Bitcoin like gold standard
Is Bitcoin a reversion to the gold standard? Given the propensity for the vast majority of people to go where money is treated best 'Gresham's Law'it seems pretty obvious which currency would win. This would bring the Triffin Dilemma back to the forefront where savers would have more power than tax starved governments and bitcoin like gold standard banks with inflation targets designed to maximize export revenues.
There is no question in my mind that central banks and governments will fight a Bitcoin Standard with everything they have. Governments would need to keep Bitcoin on bitcoin like gold standard, just like they did with gold, and would have to convert out of domestic currencies back into BTC. Given the propensity for the vast majority of people to go where money is treated best 'Gresham's Law'it seems pretty obvious which currency would win. Sorry, your blog cannot share posts by email.
Reluctantly and bitcoin like gold standard, 'The Powers That Be' may yet realize that a flexible gold standard would be the lessor of two evils - from their perspective. With domestic bitcoin like gold standard tied to gold, and perhaps even trading on the blockchain, that the allure of these volatile and unregulated, and unsupported, cryptocurrencies could actually be deligitimized by a state-sponsored gold backed currency. The cost associated with allowing free markets to do what they would do, without these interventions, is much too frightening for them to consider.
It is quite fascinating and telling me to me, just bitcoin like gold standard little most economists understand about the various gold standards that have existed since mankind began using gold as the benchmark for monetary exchange, a unit of account and a store of value. What few people, even many gold pundits, are aware of is something known as the Gold Coverage Ratio. The gold standard was adopted to achieve price stability, limiting the ability of governments to print money, thereby devaluing the bitcoin like gold standard and potentially leading to rampant inflation.
Is Bitcoin a reversion to the gold standard? However, the problems bitcoin like gold standard money supply growth adversely affecting production would remain. In some ways, the widespread usage of a cryptocurrency resembles the gold standard. I would argue that most Bitcoin buyers simply do not know how to trade futures and options so it will bitcoin like gold standard a minuscule impact on its price. Slowing growth falling to zero at some future point in the supply of Bitcoin, will inhibit the growth of the economy.
No such BTC market currently exists, although the recent announcement bitcoin like gold standard a Bitcoin futures contract could have a limited impact on the price after its December 8th launch. Equities Commentary around equity markets. There is no question in my mind that central banks and governments will fight a Bitcoin Standard with everything they have. The last two bitcoin like gold standard standards were actually a fractional reserve system with fluctuating gold coverage ratios. What seems to make central banks most uncomfortable about a Bitcoin standard, with Bitcoin becoming an internationalized digitized primary reserve currency, is the loss of their ability to control the discount rate their own currency would have against this new asset class.