In order to provide momentary relief during the coronavirus pandemic, the US Fed announced limitless money-printing, which many immediately called a bad move. While the full consequences of the move have yet to be experienced, right now, many are using the opportunity to invest in cryptocurrencies in order to protect their funds.
Even billionaires and successful businessmen around the world are starting to publicly support digital coins. The most recent example of this is Steve Forbes, the editor-in-chief and chairman at Forbes Inc.
Cryptos are a cry for help, says Forbes
According to his latest statement, Forbes believes that digital currencies can be used to help stabilize the financial system. Not only that, but he also urged even further development of Bitcoin and altcoins.
Forbes spoke of cryptos in a recent interview, conducted by the US enter for Natural and Artificial Intelligence. He also addressed a number of other related topics, such as the future of currencies, and the digitalization of finance.
But, in the context of cryptocurrencies, he said that the coins emerged as a technologically-forward cry for help. This is where he addressed the governments’ questionable moves during the pandemic, where their turn to quantitive easing and free credit actually brought numerous negative long-term consequences.
The main consequence is, of course, the expected financial instability. Such moves were already seen in recent history. One example is Japan, which had a Q.E. program in the 1980s. The program led to a decade-long period of inflation and economic output.
From 1990 to 2000, the country was in economic turmoil. Even to this day, thirty years later, it still hasn’t fully recovered. Now, the critics believe that the US is heading down the same path.
Cryptos still have a lot of work to do
However, this time, there is an alternative — Bitcoin. Forbes did admit that BTC suffers from heavy volatility. Similar comments came from China’s former central bank, which called BTC a commercial success, but criticized its volatility. According to the bank, the volatility indicated that its protocol was a speculative instrument, instead of a real currency alternative.
Another aspect that was criticized was its total supply. Forbes said that money should facilitate commerce, and not control the economy. In the end, he said that he doesn’t expect to see widespread adoption of BTC, at least not without a strong regulatory and political struggle.
But, he still believes that this can be helped with further development. Making the market extremely easy will ensure adoption, but measures that would control volatility need to be implemented. The closest assets available to this right now are stablecoins.