Many are predicting the end of the dollar; the collapse of the USD. This is something that I think is amiss. We have to realize there is a lot more pieces to this puzzle that most pay attention to.
In this video I cover some of the aspects to this conversation that show that the USD is not going to lose its reserve status soon. In fact, there are steps that can be taken to further insulate the USD.
▶️ 3Speak
Basically blockchain and crypto will only add up on current currency. Yes, it makes sense as central banks will not give up on their currency too easily, especially in the US. In regards of €, since it has gone live and replaced the DM and other national currencies it has mostly reduced the purchasing power on these nations. From what I talked with the Germans they were way better before they were introduced to the euro.
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The EURO was a total failure in my opinion. It was set up to benefit the Germans, basically at the expense of everyone else. Interesting that they were screwed too in the process.
Although I would make the case that was more than just a currency situation that caused that. The entire Eurozone concept was flawed from the beginning.
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I'd say the Germans were affected the worst. At first it was supposed that one euro would be the equivalent with two DM. All nice and well until they ate all the DMs out of the market and then gradually the prices started going up while the salaries have stayed pretty much the same, hence the purchasing power of the Germans got sliced in big chunks. Greece was also highly affected when they entered euro zone. If Romania will do the same we're screwed. I doubt it will do that soon because the minimum wage in here expressed in euros would sound really pathetic: 300...
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I don't think it will be any other fiat currency that will gradually replace the US dollar as the #1 reserve currency. I'm thinking more along the lines of crypto and legacy financial systems merging and the role of Bitcoin becoming more predominant. All of this will be very gradual. There will be no collapse. Why? As you pointed out, it will not be easy to unentangle any large currency from the global financial system if it is the currency used a very large number of outstanding long-term contracts.
What I'm looking at is the very long-term future. The sheer potential economic mass of the currently underdeveloped regions of the world is so large that they will eclipse the current developed word. Look at India, for example. It will soon surpass China as having the largest population of all countries. There are many, many low hanging fruits to be picked in India. There are countries like Vietnam that has already seen a lot of development but also its neighbors like Laos or Cambodia whose economies are at a very low level of development. The government in Cambodia is pretty terrible in terms of corruption. But, increasingly, the population are getting access to means of educating themselves as the cost of computing, bandwidth and memory keep falling exponentially. Young Africans are increasingly tech and internet savvy. There are many of them on Hive. These people are the future. Africa has massive upside potential.
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According to population researchers, India and Nigeria are the two countries that will see massive populations throughout the rest of the century. China is going to lost more than half a billion people which will knock them off track.
Like you said, there are huge opportunities there. It is good to see someone else looking at SE Asia because it is an area that I think will explode over the next few decades. That is where the growth will come from along with Africa.
We will have to see how the crypto/defi/blockchain infrastructure rolls out. There certainly is the potential to radically change how things are done. It will take a while before the infrastructure in completely in place.
It should be interesting.
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As an example of a low-hanging fruit is the opportunity for someone to make a fortune by selling and manufacturing refrigerators in rural Laos once they get the power grid built or once solar cells and batteries become cheap enough. Urbanization and modernization are spreading there, too. I recently saw a documentary about the country. The first ever modern shopping mall was built in Vientiane, the capital of Laos, recently.
What crypto/defi/blockchain has potential to do is let people participate in virtual and borderless economies, bypassing their corrupt governments entirely. For example, with cheap hardware and IT infra, some poor little kid in some remote village in some poverty-stricken country will be capable of creating content online for millions of people to enjoy while completely transforming the life of his/her entire family.
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@taskmaster4450le that is why everyone needs to start embracing the crypto/defi/blockchain because that is the future ....
One thing that will be interesting to see is how things will play out with municipalities and local governments accepting crypto for taxes, and even paying salaries in crypto. It seems this is beginning to happen.
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There are a few pockets of that around the world. Not sure how soon that will become the norm. My guess is it will take a long time. In fact, there is the likelihood that many governments will be passe before crypto is accepted.
Nevertheless, those that do are adding validity to crypto and that is what is important.
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@taskmaster4450le and I strongly believe that the validity would make the cryptos to get more accepted because I believe we humans tend to have interest in something which we perceive to be valuable and reliable..
I agree the trust factor with the Chinese is just not there and will scuttle any devious ideas they have. The Dollar will not be replaced but like you said can see businesses using crypto for trade instead as that would make more sense excluding the banks. I know for instance here in south Africa if you want to import you have to get permission from the reserve Bank to secure Forex for the trade to happen. Now think about that as this can all be bypassed now.
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Yeah as the infrastructure for crypto is put in place, we will likely see the the adoption rates kick up.
The ability to bypass the insanity of the established system is very attractive.
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The demise or no demise of the USD should not even be the issue here..my own focus is on the alternatives like the defi and cryptos which could help us create a better financial world....
To an existing world currency, I doubt USD will lose status in the following decades for reasons you've already presented in the video and I believe these are valid assumptions.
The crypto vs. fiat rethoric many have embraced in the crypto world is likely counterproductive. We should focus on crypto AND fiat, because they will likely coexist for the forseeable future in one form or another.
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