Investing in crypto-currencies this risk. There is among these a possible ban, for fear that the monopoly money of the States was questioned. If this risk is real, however, there are other arguments which militate in favour of dubbed crypto-currencies by our leaders. Here they are.
The risk of ban is real
To understand the risk of banning the use of crypto-currencies by the States, it is necessary to have an understanding of the global economy and monetary policies that are conducted by central banks since the 2008 crisis. In short, the central banks had to inject large amounts of liquidity into the global financial system to keep the economy afloat since the collapse of Lehman Brothers. The rates have been lowered to the floor, and even into negative territory on the side of the ECB.
Today, the banks are trying to raise rates and to sell a portion of the assets that they have purchased for their quantitative easing, which aimed to support the markets. The goal of the dismantling of these policies is to provide a stock of ammunition to combat the next recession. The concern is that debt, already massive at the time, has widened since 2008, so that the reversal of stimulative policies are conducted during these last years could lead to a remake of the crisis.
Among the solutions envisaged by the economists for the combat, there are the rate is negative-coupled with the widespread use of electronic money to prevent the accumulation of fluid. Such a policy means that instead of collecting interest, are you drawn to the money on your bank account. But how this policy could be effective if individuals can convert their national currency into Bitcoin ? It is the risk.
But, on the other hand, the governments would have much to lose by banning bulk of the crypto-currency. Because, in addition to the cryptos are purely monetary as Bitcoin or Litecoin, there are now a myriad of tokens that facilitate the emergence of a new economy.
The chips, of the vector of growth
If you are passionate by the ICO as I am, you will have noted the trend. Today, the vast majority of projects based on the chain of blocks that propose to develop new economic sectors, or returning to the old concepts (the bank, for example) and develop them on a record distributed. The projects of cryptos “old school” which are intended to be a simple means of payment are now very rare. I think there are two reasons behind this trend : the dimensions of the niche, and the risk of banning such projects.
Chips physical – Source Pixabay
Let’s take the example of Sharpe Capital. This project uses the funds raised by the ICO to create an investment fund coupled to a platform to gauge the sentiment of investors with respect to certain securities. Each month, we ask the holders of chips Sharpe to determine whether the price of a stock will climb or down depending on the media coverage of the company concerned. These data are sold and the holders of the chips are paid according to the amount of predictions made and their accuracy. Without the chain of blocks, this project would be either impossible to implement, or not cost effective. If the States were to take the decision to ban unilaterally all the crypto-currencies, they would deprive a vector of growth of which the planet sorely needs due to the adverse effects of globalization and automation on employment and growth.
Crypto-currency : this could appeal to government
As a currency, cryptos could even allow the government to achieve some of their objectives, and therefore become an ally rather than an enemy. As you know, all transactions are public. If States require the licensees address of portfolio to identify, they will be able to track all money flows with ease. Their big project for Big Brother, already in motion, would be thereby greatly facilitated.
What will happen to crypto-currencies ?
Very clever one who can predict what will happen to crypto-currencies in a few years. You can even play Irma ! Here’s my scenario on the basis of the information currently available to us…
- The crypto-currencies pure and hard that allow to perform anonymous transactions and who refuse to remove these features (privacy corners like Monero, Dash, etc) will be banned. Of course, they will, in theory, survive under the decentralization of the network, the technical possibility of having exchange platforms anonymous and decentralized. But their use, reduced to a handful of individuals, the marginalisera and their value will collapse.
- The crypto-currencies pure and hard, which are “transparent” might be tolerated. The government will perhaps change the code so that they are also subject to the rates negative (the Smart Contracts open the door to this possibility).
- The chips used in closed-circuit will see their existence to be validated under certain conditions determined by a specific legislation.
The ecosystem that is being developed through records distributed could revolutionize the world as the Internet has done since its creation. The sector of FinTech migrates progressively towards the chain block. The authorities of this world would be a shot in the foot by banning the complex blind. The crypto-currencies will nevertheless need to show white leg to be aligned with the objectives of government, namely the fight against tax evasion and the need to keep a control over the money of the citizens.