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Topic: [2021-02-26] Bitcoin Captures 3 Things Central Banks Should Be Concerned About (Read 39 times)
March 09, 2021, 03:01:54 AM
February 25, 2021, 10:48:23 PM
It appears Allianz’s chief economic adviser is optimistic that central banks might begin accepting bitcoin or be involved. I reckon not before they have tried everything to stop it with their full power.
The longterm might be shaky for the cryptospace because we are in a world where the governments have total interests on their monopoly on currencies. They will not give this without a war.
Allianz's chief economic adviser sees three types of investors flocking to Bitcoin—and says all three should be concerning to central banks.
The first group of Bitcoin investors right now are those "who truly believe Bitcoins will become money," El-Erian said, "a currency as opposed to a commodity. If you're a central bank and you have a monopoly over money, that's not very reassuring at all."
The second party are those "who are adopting Bitcoin for negative reasons," El-Erian said. "They're being pushed out of everything else and pushed into Bitcoin. It's like being pushed into a marriage. Why are they doing that? Because they don't know how else to mitigate risk. Do you really want to invest in a government bond whose price has been artificially jacked up? So 'let's diversify, let's put 2% into Bitcoins.' You're doing it for negative reasons, to protect yourself; the first camp are doing it for positive reasons."
The third camp? Speculators, plain and simple. "Where else," El-Erian asked, "do you get 20% returns or losses in a single day?"
All three groups, El-Erian said, "should be concerning to central banks. When it's trading above $50,000, all three messages are problematic for central banks. So, we are going to see central banks look increasingly at cryptocurrencies as something they should be involved in, and not just stand on the sidelines."
Read in full https://decrypt.co/59317/el-erian-bitcoin-3-things-concerning-central-banks
The longterm might be shaky for the cryptospace because we are in a world where the governments have total interests on their monopoly on currencies. They will not give this without a war.
Allianz's chief economic adviser sees three types of investors flocking to Bitcoin—and says all three should be concerning to central banks.
The first group of Bitcoin investors right now are those "who truly believe Bitcoins will become money," El-Erian said, "a currency as opposed to a commodity. If you're a central bank and you have a monopoly over money, that's not very reassuring at all."
The second party are those "who are adopting Bitcoin for negative reasons," El-Erian said. "They're being pushed out of everything else and pushed into Bitcoin. It's like being pushed into a marriage. Why are they doing that? Because they don't know how else to mitigate risk. Do you really want to invest in a government bond whose price has been artificially jacked up? So 'let's diversify, let's put 2% into Bitcoins.' You're doing it for negative reasons, to protect yourself; the first camp are doing it for positive reasons."
The third camp? Speculators, plain and simple. "Where else," El-Erian asked, "do you get 20% returns or losses in a single day?"
All three groups, El-Erian said, "should be concerning to central banks. When it's trading above $50,000, all three messages are problematic for central banks. So, we are going to see central banks look increasingly at cryptocurrencies as something they should be involved in, and not just stand on the sidelines."
Read in full https://decrypt.co/59317/el-erian-bitcoin-3-things-concerning-central-banks
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