Bitcoin and Stablecoins Offer Alternatives to National Currencies, But With Tradeoffs
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New monetary technologies like Bitcoin and stablecoins have potential to disrupt legacy money systems and offer investment opportunities. Over 160 state currencies have limited global acceptance and salability.
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For people in countries with high inflation or financial restrictions, these technologies allow access to better money and circumvent government barriers.
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Bitcoin provides a decentralized global bearer asset, while dollar-pegged stablecoins offer stability but rely on centralized issuers and dollars.
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Adoption of these assets has been growing steadily for over a decade, especially in developing countries. This could gradually erode national currency monopolies.
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Bitcoin and stablecoins have different tradeoffs in terms of decentralization, volatility, and other attributes. Their growth enables a new open global monetary system alongside national currencies.