Crypto Is HOW Big?? And Another Bitcoin (BTC) vs CBDC Debate?

By Michael @ CryptoEQ | CryptoEQ | 5 Apr 2022


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Crypto's Growth

Crypto is no longer just for hackers, libertarians, or meme-chasing investors. Institutional investors, mega-corporations, pension funds, even countries are opening their doors to cryptocurrencies. Many now have carved out a portion of their portfolio for crypto and its many benefits. Finally, it has arguably become riskier to own zero crypto than some.

Just in March 2022…

  • Bridgewater Associates, the world’s largest hedge fund led by financial star Ray Dalio, announced it’s preparing to back its first crypto fund
  • Goldman Sachs and Galaxy Digital partner completed the first OTC crypto trade involving Goldman.
  • ExxonMobil is expanding its flared natural gas Bitcoin mining pilot program to potentially four new global areas along with the help of Crusoe Energy. 

The M2 money supply has doubled in ~10 years as central banks have attempted to stimulate economies during various economic crises, pushing inflation up and nominal rates to multi-decade lows. Meanwhile, crypto penetration is mirroring the internet growth curve as neutral, seizure-resistant money with a predictable and hard-capped supply schedule begins to look attractive compared to fiat.

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Source

So, where have we come since ~2009 when Bitcoin was invented and the fiat money-printing really began to increase? 

  • Went from unppriced (because there was no market) to ~$50,000+ per bitcoin
  • ~$1 trillion in stored wealth ranking it in the top-20 currencies globally
  • Over $8 trillion transferred since 2009
  • Over 1 million unique addresses, nearing all-time-highs
  • The world’s largest network of computers, creating the most globally-secure financial settlement layer in history 
  • Recognized legal currency in El Salvador
  • From geeky email lists to NASDAQ listings
  • Public companies like Tesla, Square, MicroStrategy, and others have added BTC to their treasury reserves

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Source

 

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Bitcoin and cryptocurrencies are growing in the countries that need it most



CBDCs

Spencer Randall, CryptoEQ: “I think a lot of Americans are already accustomed to interacting with the digital dollar. So I think it’s more of an upgrade of our infrastructure and technology. There are leading global powers that have already rolled out test pilots of CBDC’s at scale, that are quite successful. So I see it as a natural progression. I do think that we’ll have CBDC’s here in the United States.”

A Central Bank Digital Currency (CBDC) is being investigated by 100+ countries across the globe including the U.S. government as part of President Biden’s recent executive order. CBDCs are digital money, like 85%+ of the money in existence today, but with grave new complications. CBDCs can centralize Americans' financial information and money in a digital database under the full control of the U.S. government, granting them authoritarian-style surveillance powers including the ability to determine how and when someone spends their money. 

Ultimately, governments will be in favor of a CBDC because it grants central banks far more power over our payment behavior.  A central bank digital currency system doesn’t require middlemen such as banks or credit card companies who compete for our business. Instead, one entity will have the power to orchestrate the U.S. dollar, which makes up ~45% of all global commerce. 

One way central banks could use its expanded influence is to exert control over people’s spending habits. With a CBDC, the Federal Reserve could directly subtract taxes and fees from any account in real-time. The government would have a complete record of every transaction made by everyone and could use that data to influence citizens similar to social media ads. Fines, such as for speeding or jaywalking, could be levied in real-time. CBDCs would allow governments to micro-manage their constituents to an extent never before seen and, if they for whatever reason they see fit, remove that person from the financial system entirely with one click of a button. 

 

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U.S. Congressman Tom Emmer. Source

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Michael @ CryptoEQ
Michael @ CryptoEQ

I am a Co-Founder and Lead Analyst at CryptoEQ. Gain the market insights you need to grow your cryptocurrency portfolio. Our team's supportive and interactive approach helps you refine your crypto investing and trading strategies.


CryptoEQ
CryptoEQ

Gain the market insights you need to grow your cryptocurrency portfolio. Our team's supportive and interactive approach helps you refine your crypto investing and trading strategies.

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