Deutsche Bank named the factor of capital outflow from fiat to bitcoin in the next decade
The Next Decade Has Chances To Be The Heyday Of Cryptocurrencies If Deutsche Bank Strategist Jim Reid Is Right In His Conclusions.
Reid prepared a report entitled “Imagine 2030”, where he considered 24 alternative ideas that could become reality if national currencies continue to demonstrate their insecurity. Excerpts from it are quoted by Bloomberg.
“The forces that upheld the integrity of the fiat system now look fragile and could disintegrate in the 2020s,” Reid writes. “If this happens, the start of the rejection of fiat money will be laid, and the demand for alternative currencies such as gold or cryptocurrencies may increase.”.
The analyst recalls the emergence of runaway inflation and the rise in gold since the end of the gold-backed monetary system in the 1970s. In his opinion, it is not the central banks that should be thanked for suppressing global inflation, but China, which has become a key supplier of labor over the past four decades..
The positive impact, however, is coming to an end with the peak of the population moving out of working age over the past decade. Thus, the authorities may be forced to start increasing budget spending and abandon the aggressive monetary policy that served the interests of those who had labor-related assets and capital..
“If and when the cost of labor rises to the limit, it is likely that conditions for the authorities will become more difficult. As long as politicians continue to worry about elections, the likelihood of a catastrophic failure due to inflation is growing, ”he writes..
Over time, the role of inflation may continue to grow, along with which confidence in sovereign currencies will decline, which in turn will drive demand for alternative currencies, Reid said, adding: “Will fiat currencies survive the political dilemma that the authorities face as they try balancing between rising emissions and record levels of credit? Will the multi-trillion dollar system take over? This is the question for the next decade. “.
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