Bitcoin is close to reaching the $ 1 trillion market cap mark, a market value that is beginning to be relevant to the world economy. Now, the world's leading cryptocurrency has an objective proportional to its disruption: to become the great reserve of value of humanity. In this scenario, what would change in the world?
1) End of the dollar standard
The United States has a huge economic advantage over other countries. This is because the US dollar was chosen as the reserve of world value after the Bretton Woods agreement. With BTC becoming the world standard, the US will lose much of the economic power it has today. However, do not be fooled into believing that the country will cease to be a great monetary power. Currently, even though the USA is not the place that most adopted BTC in the real economy, it is the country that moves the most bitcoins in the world. This is precisely because they are the richest economy on the planet, and have a currency more used than the others issued by other central banks.
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Countries with the highest volume of Bitcoin transactions. Source: BlueBanx.But after all, who will benefit the most in this scenario of wide adoption?
2) Biggest cash transfer in history
This will probably be the biggest cash transfer in human history. And the ones who will most benefit from this flow of capital being allocated to the cryptocurrency are the individuals, companies and governments who adopt it first. your BTC cash balance would increase exponentially in value and have large cash reserves to finance your operations. This is without the need to use any fiat currency to broker payments. We will also see a cash transfer from the older generation, which is usually more averse to adopting new technologies for millennials and younger generations, who tend to be the first to adopt them. -over there. Read more: Bitcoin could make Iran one of the richest countries in the world
3) Satoshi becomes the richest person in history
Satoshi Nakamoto would not make the list of the richest people in the world, but for the list of the richest people in history. The title of richest man in history is attributed by researchers to King Solomon, and much of his money came precisely because of the control of the currency in force at the time, salt. It is believed that Satoshi owns the mysterious wallet that has 1 million bitcoins, representing about 4.7% of the bitcoins that will exist in history, if we do not disregard the bitcoins that are lost forever. In this scenario, Satoshi will have the ability to build pharaonic works and an economic power concentrated in a single person, or small group of people, probably never seen in modern history. Will he ever move his coins again?
3) Very high rates
The Bitcoin blockchain has a relatively low limit on allowed transactions. The network was built this way so that it remains safe and decentralized. Because of this, BTC has very high transaction fees, and they tend to increase more and more in the future. However, this is not as apocalyptic as it appears to be, and it was predicted by Hal Finney many years ago, one of the most important names in the history of Bitcoin. on the main network. He went on to state that central banks could use bitcoin as a ballast for issuing their own currencies, exactly as it happened with gold in the past. Other solutions, such as Lighting Network, or even the creation of private layers may appear. The main network would then be reserved for large transactions and more important things. The public blockchain of BTC would be used to prove that in fact the institutions have the amount of money they say they have, a problem that will always exist with gold. There is much speculation as to how much gold actually exists in the world, because if you don't have it physically, you don't have the guarantee that it does exist, a problem solved by Bitcoin.
4) A new era of prosperity
The foundations of the economy and money would change completely. We would leave a monetary system built on a house of cards and enter it was ‘hard money’, with a scarce and resistant coin being the world standard. To understand this movement, we need to look to the past. Modern monetary history is often confused with the history of the United States and the US dollar. Three important events that directly involved the United States, marked the history of money and completely changed the foundations and directions of the economy and modern life. Are they: 1) The creation of fractional reserves two) The end of the gold standard 3) The debt economy In principle, the American dollar in its origin, was nothing more than a gold-backed bond. Ultimately, $ 35 dollars could be converted into a 1 oz of yellow metal. This made the dollar a strong currency, as the bond issue was limited by the country's gold reserves. Was the dollar originally just a gold derivative?The regularization of fractional reserves was the first step towards the destruction of the currency's power. A practice that was attributed to corrupt bankers, became a state policy, allowing in fact there was more money in the real economy than the general sum of savings. end of dollar parity with gold after a unilateral decision by the United States to break the Bretton Woods agreement, which established the dollar as a world standard. For many, this was inevitable, as the government's gold reserves could no longer justify the total existing dollars. And the third point is the creation of an economy based on practically unpayable debts and the depreciation of interest rates, which today are artificially defined by central banks.World public debt – Source The EconomistIf interest is the value of money over time, and interest rates are close to zero, how much is our money worth?Productivity vs compensation. Source: WTFHapppend1971.The end of the dollar's parity with gold after the break of the Bretton Woods agreement in 1971, influenced the entire macroeconomics of the following decades. This milestone caused a gap between the increase in productivity and the amount paid for the work performed. This is just one of the metrics that can be found on the WTFHapppend1971 website. A fourth step in the history of money seems to be emerging, the was Bitcoin. This event would create the basis for a new, more solid and resilient economy, where interest rates correspond to savings and the currency can no longer be devalued. How far can it lift humanity? This is something that we will see in the future.Read more: Meet the best of the Bitcoin market in Brazil