One of the reasons why cryptocurrency is so interesting is the fact that it is believed to be the currency of the future. Crypto does not suffer from some of the restrictions of traditional fiat currency in that it can be sent instantaneously, is not issued by a central authority and many of the transactions done with crypto are untraceable. This has led many to speculate that cryptocurrency will become the dominant world currency at some point in the near future and will overtake prominence fiat currencies like the US dollar and the British pound.
However, chief economist of the International Monetary Fund (IMF) Gita Gopinath has stated that while cryptocurrencies are intriguing, they will not dethrone the US dollar in the world market.
US Dollar to Retain Dominance
Gopinath accepts the benefits of cryptocurrency and the reasons why it is seeing favor in the world markets but nevertheless states that the US dollar has qualities that will help maintain its dominance.
“Improvements in payment technology may have lowered the cost of switching from cash to digital payments, but there is little evidence they have done much to reduce the expense of moving among currencies,” Gopinath said, “Widely-held perceptions of the dollar’s safety and stability have kept it dominant in the international monetary system for decades.”
Gopinath also addressed the rise in popular stablecoins such as Facebook’s upcoming Libra token as well as the digital token being developed by China. Despite these, she insists that US dominance will not be changing anytime soon.
“While these are intriguing possibilities, they are improbable in the near-term,” Gopinath Send, pointing out that the prominence of the US dollar in trade and banking will not let it easily be dethroned. She also made reference to a number of popular stable coins within Europe that have not been able to compete with the US dollar those fall and several safety Ness that have already been put in place to protect the dollar. In summary, Gopinath a state about them too many complicated fuck does that will prevent the US dollar from losing its place so cryptocurrency.