Ex­perts pre­dict out­law of Bit­coin in 2020

The Punch - - CAPITAL MARKET -

gLOBAL mar­kets are be­gin­ning to feel the pinch of a slow­ing econ­omy, and Bit­coin may be a vic­tim.

Ac­cord­ing to be­ingcrypto. com, economies around the world be­gin to stag­nate after the growth of the past decade, many be­lieve Bit­coin will face a har­row­ing fu­ture.

the Truthraide­r said Bit­coin would be out­lawed by 2020 when global mar­kets col­lapse.

Bit­coin is fa­mously not a friend of cen­tral­ized gov­ern­ments and eco­nomic con­trols. In fact, Bit­coin be­gan as a re­ac­tion to the prob­lems of gov­ern­ment bailouts after the 2008 cri­sis.

the ge­n­e­sis block of Bit­coin con­tained the head­line, “the times 03/Jan/2009 Chan­cel­lor on brink of sec­ond bailout for banks.” the ‘too big to fail’ events dur­ing the cri­sis paved the way for Nakamoto’s de­cen­tralised fi­nan­cial mech­a­nism.

the string of eco­nomic suc­cesses that fol­lowed the cri­sis has led to a long bull run. the cur­rent global econ­omy, how­ever, ap­pears to be tee­ter­ing on the brink of a sub­stan­tial turn­around.

Re­cent news, such as the need for quan­ti­ta­tive eas­ing, and neg­a­tive in­ter­est rates in Europe, are con­cern­ing. When the next con­trac­tion takes place, these cur­rent poli­cies may well spell the demise of many eco­nomic struc­tures.

Re­gard­less of the im­pacts of a fi­nan­cial catas­tro­phe, gov­ern­ments are not keen on un­reg­u­lated pay­ments. If masses of con­sumers moved to Bit­coin us­age, gov­ern­ments would be left with a dif­fi­cult choice. the only op­tions avail­able would be to heav­ily reg­u­late Bit­coin, or ban it al­to­gether, as truthraide­rhq sug­gests.

this type of re­sponse has al­ready been seen in China, where Bit­coin is a gov­ern­ment pariah. In­ter­est­ingly, how­ever, the Chi­nese gov­ern­ment is us­ing the dig­i­tal cod­ing un­der Bit­coin – the blockchain to is­sue its own dig­i­tal cur­rency.

Rather than sim­ply seek to ban cryp­tocur­ren­cies, the Chi­nese gov­ern­ment has cre­ated its own. the de­cen­tral­ized ledger of blockchain tech­nol­ogy al­lows for ver­i­fi­able and track­able con­trols on trans­ac­tions. the re­sult of the tech­nol­ogy is greater con­trols than be­fore.

Whether Bit­coin is banned or not, many see the move­ment to­ward greater con­trols as a sign of the fu­ture. As global mar­kets feel the pinch, the world’s first cryp­tocur­rency may well find it­self banned by many world gov­ern­ments.

How­ever, with Bit­coin be­ing such a small ‘fish’ in the global fi­nan­cial scheme, it may not face much trou­ble. A true fi­nan­cial col­lapse would re­quire mas­sive re­sponses from gov­ern­ments, and deal­ing with or out­law­ing Bit­coin could be just a mi­nor side is­sue in com­par­i­son.

Newspapers in English

Newspapers from Nigeria

© PressReader. All rights reserved.