The arrival of Bitcoin on the scene is arguably the best thing to happen to the world’s financial sector in about a decade. This digital currency has grown from being just an amazing invention to becoming a rapidly developing investment market. While this achievement by Bitcoin is great in itself, the flagship cryptocurrency appears to have more to offer. As the days, months and years go by, Bitcoin is gradually becoming an alternative to regular currencies. This is coming at a crucial time when it appears that lots of governments are finding it difficult to regulate finances. With the US-Dollar not left out of the mess associated with regular currencies, Bitcoin has been tipped to replace the US Dollar as the world’s reserve Currency. This might seem crazy, but is definitely not without reason.
Bitcoin was designed to have Advantages over Regular Currencies
Unlike regular currencies, there is a limit to the amount of Bitcoins that can ever get into circulation. While this limit has not yet been reached, it does exist. By design, not more than 21 million Bitcoins can be created. This implies that as soon as 21 million Bitcoins are mined, that will be an end to the mining of Bitcoin. Although this probably seems quite insignificant, it is the direct opposite of traditional currencies which always get printed whenever there is a perceived need.
The ability of the governments to print money as they please may seem nice because of the freedom involved but in the long run, it leads to the devaluation of the currency. Over-time, lots of government currencies, the US-Dollar included has lost value. Unlike these traditional currencies, Bitcoin is expected to gain more value with time. Also, the fact that there is not a huge supply of Bitcoins as compared to traditional currencies appears to be a solution to inflation. This, therefore, makes Bitcoin an ideal currency to be used for the store of wealth.
Bitcoin is not affiliated with any Government
The limited supply of Bitcoin might be an amazing advantage that it has over the US-Dollar. That, however, is not the only advantage that it has. One other factor that could lead to Bitcoin replacing the US Dollar as the world’s reserve currency is the fact that it is independent of any government. This implies that irrespective of decisions by governments that might lead to a crash of currencies that they control, the flagship cryptocurrency will not be affected by any bad government financial decisions.
How soon will Bitcoin replace the US Dollar as World’s reserve currency
Although speculations are high, it is still uncertain how soon Bitcoin will replace the US Dollar as world’s reserve currency. The reasons for this are quite simple; Bitcoin was designed to be an option to traditional currencies and not necessarily a replacement. Also, if Bitcoin replaces the US Dollar as world reserve currency, then, there is a likelihood that governments might want to control it, thereby making it lose its decentralization feature.
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