Modern Economic Nonsense — The dollar is dying slowly

By xuanling11 | Crypto Learning | 18 Jun 2022


53c38bda39b451d4915f75a2b43fd97871f8231172d6001fce110e0dbcae4793.jpg

Join Robinhood to buy and sell crypto without transaction fees.


The greenback is no longer the world’s reserve currency ⚰️, and this is becoming evident by the day. Emerging economies are moving toward reducing their exposure to the dollar — some are even willing to pay a heavy price. The nations that make up the majority of the world economy have grown tired of being at the mercy of the U.S., which has used its position as a global monetary superpower to siphon off wealth from other nations in exchange for cheap credit and token assets such as stocks in American companies. It has been over 200 years since England abandoned the gold standard and introduced paper money as a primary means of financial transaction. Since then, there have been numerous attempts to revert back to gold-based money or some variation thereof; however, none has succeeded so far. Today we live in a digital world where information is stored in bytes instead of gold bars, tokens are more relevant than coins, and digital payment systems like PayPal have replaced leather purses filled with gold coins as an instrument to pay for goods and services. This raises another question: Will fiat currencies survive another 200 years? Hint: probably not.

 

The end of an era?

The first thing that comes to mind when discussing the end of the era of fiat currency is the end of the era of the U.S. dollar as the world’s primary reserve currency. The dollar has reigned supreme since the 1940s when the U.S. abandoned the gold standard and introduced the Bretton Woods system. The dollar has been on a downward trajectory ever since the financial crisis exploded in 2007-2008. The crisis has been the catalyst that has accelerated the dollar’s demise. The crisis has also exposed the flaws of the financial system. The response to the crisis, which involved flooding the economy with cheap money through low-interest-rate policies, has created even more instabilities in the system with multiple levels of bubble within the financial system everywhere. The dollar’s fall has been the most spectacular, and it has been hastened by the U.S. administration’s imposition of various trade tariffs and sanctions on other countries. In 2022, with many chaotic world of war, health crises, money crises, debts crises, food crises, climate crises, ... you can add more in the coming years, can the dollar be trustable anymore to weather down the multiple levels of crises?  

 

FUD: Fear, uncertainty, and doubt

😱 Fear: As other central banks acquire more gold, their gold reserves increase. This increases their demand for gold, thus driving up the price of gold. The ever-increasing price of gold is a constant reminder of the fragility of fiat currencies and the impending doom of the dollar as the world’s primary reserve currency. However, going back to the gold standard is going backward in history. Digital currency is preferable to move past forward. 

 

🤯 Uncertainty: Uncertainty is inherent in the financial system. The system is very complex, and its failure is inevitable. 

 

🤯 Doubt: As the world’s financial system becomes more fragile and appears more likely to fail, the demand for gold increases. This puts pressure on the dollar and hastens its demise as the world’s primary reserve currency.

 

The rise of digital currency

The world is moving toward a cashless society, and this is another ominous sign for the dollar. More than 60% of transactions are done electronically, and some people are even willing to move entirely away from cash. People are increasingly relying on electronic payment systems to buy goods and services. This transition from cash to electronic money has given rise to digital currency, which is neither backed by gold nor guaranteed by a government. Some of these digital currencies have become very popular, and their usage is growing fast. These digital currencies are decentralized and use peer-to-peer systems to make transactions. They are also used in Decentralized Autonomous Organizations (DAOs) to raise the company's funds. This revolutionary development will likely undermine the future of fiat currencies and hasten the dollar’s demise.

 

Blockchain technology is the future

Cryptocurrencies are just the tip of the iceberg. They have been around for less than a decade, and their popularity is growing fast. It is only a matter of time before they become mainstream and replace fiat currencies altogether. This is because blockchain technology, which powers cryptocurrencies, is becoming more robust and scalable. Blockchain is a distributed ledger technology that is immutable (cannot be tampered with), auditable, and transparent. It has the potential to transform the global economy in a decade or two. It is already being used in many sectors: food safety, supply chain, financial services, healthcare, real estate, and governance. Governments and financial institutions are exploring how they can use blockchain in their operations. It is only a matter of time before it becomes the standard for financial transactions. When that happens, fiat currencies will become redundant.

 

Conclusion

The dollar is dying slowly, and this is evident from the increasing demand for digital payment systems and the adoption of digital currency. Emerging economies are moving fast toward reducing their exposure to the dollar. Some are even willing to pay a heavy price for it — and they are likely to succeed. The dollar is the world’s primary reserve currency, but it is being challenged by the rise of other currencies. The dollar has lost its value and will inevitably be replaced by another currency as the main store of value.


Note: the post was shared on multiple platforms here.

You can refer my previous article lists here and here
------------------------
2022 Prediction
2022 Prediction #1: L1 Scalability
2022 Prediction #2: L2 Bridges
2022 Prediction #3: Zero-Knowledge Proofs or ZKPs
2022 Prediction #4: Regulated Defi On-Chain KYC
2022 Prediction #5: Institutional Crypto Adoption
2022 Prediction #6: Defi Insurance
2022 Prediction #7: NFTs-Based Communities - DAO 1.5
2022 Prediction #8: Metaverse and NFTs
2022 Prediction #9: Web2 Companies’ FOMO
2022 Prediction #10: Time for DAO 2.0
------------------------
DAO The Way
DAO The Way Part 1
DAO The Way Part 2
DAO The Way Part 3
DAO The Way Part 4
DAO The Way Part 5
DAO The Way Part 6
DAO The Way Part 7
DAO The Way Part 8
DAO The Way Part 9
DAO The Way Part 10
DAO The Way Part 11
DAO The Way Part 12
DAO The Way Part 13
------------------------
Learn How To Defi
Learn How To Defi Part 1
Learn How To Defi Part 2
Learn How To Defi Part 3
Learn How To Defi Part 4
Learn How To Defi Part 5
------------------------
Crypto Comics
Crypto Comics
Crypto Comics - PoW
Crypto Comics - Who is Satoshi
Crypto Comics - What is Token
Crypto Comics - What is DeFi
Crypto Comics - What is Wallet
Crypto Comics - What is HODL
Crypto Comics - What is Coinbase
Crypto Comics - What is PoS
Crypto Comics - What is DAO
Crypto Comics - What is A Block
Crypto Comics - What is NFT
Crypto Comics - What is Fork
Crypto Comics - What is Web3
Crypto Comics - What is DeFi-2
Crypto Comics - What is Yearn Finance
Crypto Comics - What is Degen
Crypto Comics - What is Aping
Crypto Comics - What is Cold Wallet
Crypto Comics - What is Hot Wallet
Crypto Comics - What is Airdrop
Crypto Comics - What is DYOR
Crypto Comics - What is 65537
Crypto Comics - What is RC4
Crypto Comics - What is WAGMI
Crypto Comics - What is Bagholder
Crypto Comics - What is Decentralization
Crypto Comics - What is Wallet Address
Crypto Comics - What is Plagiarism in Web3
Crypto Comics - What is Bart Pattern
Crypto Comics - What is Encryption
Crypto Comics - What is Consensus
Crypto Comics - What is Protocol
Crypto Comics - What is Stablecoin
Crypto Comics - What is ApeCoin
Crypto Comics - What is FOMO
Crypto Comics - What is Tokenomics
Crypto Comics - What is APR
Crypto Comics - What is to The Moon
------------------------
Learn Web3 in 100 Days
Learn Web3 in 100 Days - #1 What is the Internet and How Relevant to Web3
Learn Web3 in 100 Days - Day 2: What are the Browsers and Servers
Learn Web3 in 100 Days - Day 3: What are HTTP Status Code
Learn Web3 in 100 Days - Day 4: HTML and CSS and JS
Learn Web3 in 100 Days - Day 5: What is programming
Learn Web3 in 100 Days - Day 6: Markup, Elements, Tags, and Hyperlinks
Learn Web3 in 100 Days - Day 7: Style Your Web
Learn Web3 in 100 Days - Day 8: JS
Learn Web3 in 100 Days - Day 9: SQL
Learn Web3 in 100 Days - Day 10: Front-End
Learn Web3 in 100 Days - Day 11: Front-End Framework
Learn Web3 in 100 Days - Day 12: More HTML
------------------------
Modern Economic Nonsense
Modern Economic Nonsense - Inflation and Incentives
Modern Economical Nonsense - The Astrologist's Way
Modern Economical Nonsense - The VUCA World
Modern Economical Nonsense - Zug Tax and How to Run your Own Monopoly
Modern Economical Nonsense - Participatory Economy
Modern Economical Nonsense - Economic Models
Modern Economical Nonsense - Tokenomic Models
Modern Economical Nonsense - Design A Reputation-Based System
Modern Economical Nonsense — The Money Problem
Modern Economical Nonsense — The Treasury Problem
Modern Economic Nonsense — Bitcoin vs. Real Estate
Modern Economic Nonsense — A very long term view
Modern Economic Nonsense — Banking Collapse
Modern Economic Nonsense — A Wall Street Legend
Modern Economic Nonsense — A Modern Alchemy
Modern Economic Nonsense — Founder goes ghosting
Modern Economic Nonsense — Anonymous cool or fool
Modern Economic Nonsense — The market volatility
Modern Economic Nonsense — The money shortage
Modern Economic Nonsense — The web3 scams or not
Modern Economic Nonsense — All about debts
Modern Economic Nonsense — Metaverse is still relevant or not
Modern Economic Nonsense — A Show of Recession
Modern Economic Nonsense — A Myth of Valuation
Modern Economic Nonsense — Inflation becomes irrelevant
Modern Economic Nonsense — A journey of money laundering
Modern Economic Nonsense — Consumer Sentiment Might Be Low
Modern Economic Nonsense — Is payment technology still relevant in high inflation environment
Modern Economic Nonsense — Recession is coming
Modern Economic Nonsense — We are at the bear market, now what
Modern Economic Nonsense — Invest like a cat
Modern Economic Nonsense — Bitcoin leads the market recovery
------------------------
Yearn Finance Comic
Yearn Finance Comic - Part 1
Yearn Finance Comic - Part 2
Yearn Finance Comic - Part 3
Yearn Finance Comic - Part 4
Yearn Finance Comic — Part 5
Yearn Finance Comic - Part 6
------------------------
Curated Lists
Curated Lists - Web3 Culture
Curated Lists - Crypto-enabled Communities
Curated Lists - Crypto Philosophy
------------------------
Defi 101
Defi 101 - Part 1
Defi 101 — Part 2
------------------------
Thoughts
Thoughts about VC and PleasrDAO x BitDAO
The Crypto Market has Changed
The Myth of Inflation Hedge
The Myth of Stablecoin
The Myth of NFT
End of the Crypto Market?
The End of the Stablecoin?
Terra-UST Saga - How to repair the trust when there is no trust built on
How to deal with negative market sentiment
------------------------
Crypto VC Thoughts
Crypto VC Thoughts: Physical Assets vs Digital Assets
Crypto VC Thoughts: Digital Money Pushes Energy Companies to Innovate
Crypto VC Thoughts: GameFi Dilemma
Crypto VC Thoughts: Credit Oceans
Crypto VC Thoughts: The Death of Terra
Crypto VC Thoughts: Debunk Bitcoin Myths
Crypto VC Thoughts: Defense Crypto Investment Methods
Crypto VC Thoughts: New Type of Stablecoin
Crypto VC Thoughts: Crypto Business Cycle
Crypto VC Thoughts: Crypto Business Cycle 2
-------------------------------------------------------------------------------------
Disclosure: The article was written by a delusional author who is possibly a nut job without any questions whatsoever about expertise in the subject matters. You should not believe any words this author wrote or you may experience similar symptoms or even possibly become a nut job.

How do you rate this article?


34

0

xuanling11
xuanling11

A delusional author who is possibly a nut job without any questions whatsoever about expertise in the subject matters to write with a freestyle.


Crypto Learning
Crypto Learning

All article was written by a delusional author who is possibly a nut job without any questions whatsoever about expertise in the subject matters.

Send a $0.01 microtip in crypto to the author, and earn yourself as you read!

20% to author / 80% to me.
We pay the tips from our rewards pool.