BITCOIN could be poised to overtake the dollar by 2030 as the world’s reserve currency, experts in the soaring cryptocurrency believe.
The digital money hit its all time high against the US dollar on Wednesday when a single Bitcoin was trading for nearly $67,000.
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It came after years of often volatile yet meteoric growth since the daddy of all crypto was first released by a shadowy figure or figures going by the name Satoshi Nakamoto in 2009.
Satoshi disappeared and no one has ever conclusively proven who he, she or they might be – but their invention is now one of the few runaway success stories in an otherwise struggling economy.
Leading lights in the Bitcoin community say it is not far from overtaking the value of all the silver in the world and will “easily” have over a billion users within the next five years.
With national currencies currently being devalued by central banks through money printing and Bitcoin’s inbuilt cap of 21 million coins, they argue we may be on the cusp of “hyperbitcoinization”.
Alex Gladstein, chief strategy officer of the Human Rights Foundation and a well-respected Bitcoin voice, told The Sun: “It’s just a growing inevitability that over time Bitcoin’s price continues to move in an upward direction against the dollar.
“It’s going to be volatile, it’s going to go up, it’s going to go down, but over time you have an asset in Bitcoin whose supply rate cannot be changed.
“It only issues a certain amount every 10 minutes and that’s predetermined for the next hundred plus years.
“And it’s competing against assets which are being created anew at historical rates, currency to currency.
“You look at the Federal Reserve or the European Central Bank’s balance sheets, it’s remarkable how much new money is being created. It’s historic.
“Bitcoin is a device ultimately whose aim is to replace the dollar as the reserve currency of the world.
“Whether or not it does that, who knows, but that’s what Satoshi envisioned when they created an electronic cash that was beyond the control of governments.
“The whole point was to provide an alternative to the central banking system which bails out corporations.
“Bitcoin might fail but people should be clear-eyed that its mission is to replace the fiat money at the heart of central banking.
“I personally think it will get there, it could take decades but I think it’s inevitable because governments are self-interested.
“They’re going to want the most valuable, hardest, best money, and that’s Bitcoin.”
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The US dollar officially became the global reserve currency following the Bretton Woods Agreement in 1944 and since then has been held by central banks across the world for international transactions.
At its peak Bitcoin was trading at $66,999 on Wednesday, according to the Coinbase cryptocurrency exchange.
That topped a previous record of $64,899 set in mid-April and means Bitcoin is worth almost six times as much as this time last year.
The record-busting price came after a major milestone on Tuesday when the first ever exchange-traded fund linked to Bitcoin was launched on Wall Street.
ProShares Bitcoin ETF was an immediate hit on the New York Stock Exchange, topping $1 billion in trading volume on its first day.
But Bitcoin’s critics have often pointed to its extreme price volatility as a major risk for investors, with big buyers and sellers able to manipulate its price.
In June the price crashed a huge 50% down from the previous all-time high before recovering and rallying to Wednesday’s record.
There have also been claims that Bitcoin’s network is clunky and cumbersome, despite its Lightning Network rapid payment system’s apparent success in El Salvador.
The Central American nation became the first ever to grant Bitcoin legal tender status in September.
But questions remain over how other governments and central banks will react to the growing popularity of Bitcoin’s decentralized monetary system after China has repeatedly cracked down on it.
The original cryptocurrency has no central authority that can control it and runs through a network of nodes maintained by its users.
Coin Stories podcast host and Bitcoin educator Natalie Brunell told The Sun: “Governments certainly have the power to regulate and create disincentives through tax measures.
“I don’t see the US doing that to Bitcoin because the SEC (Securities and Exchange Commission) has recognized its legitimacy as a financial asset with the approval of this ETF.
“I hope the US will eventually see a strong justification for putting it on its own balance sheet.
“You effectively can’t kill Bitcoin unless you take down the whole internet.
“This is the power of a distributed network that has no central point of failure or weakness.
“And governments that are favorable to it, like El Salvador, will attract business and innovation surrounding the cryptocurrency and its mining to their nations.”
Bitcoin is currently thought to have some 50 million users in the US and a total of around 200 million worldwide.
Transactions on its blockchain, or digital ledger, are verified by “mining” with computers that solve complex math problems and produce new Bitcoin in the process.
Asked where she sees Bitcoin in 10 years time, Natalie added: “I believe Bitcoin will easily have more than a billion users within just five years.
“A decade from now I believe most institutions and even governments will hold Bitcoin in their treasuries.
“I believe the price per Bitcoin will exceed $1 million per coin, but the bigger question will be what will the U.S. dollar be worth at that point.
“We have been printing so much money and expanding the dollar supply in a way that gives the perfect value proposition for the fixed supply and immutable ledger of Bitcoin.”
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