American economist Brian Wesbury shared his thoughts on what would happen if the masses abandoned fiat currencies and accepted bitcoin instead. He discussed whether the government would allow this to happen and how bitcoin could become a real currency.
Economist Brian Wesbury answers a question about the masses giving up Fiat’s currencies for bitcoin
Brian Wesbury is an economist with a focus on macroeconomics and economic forecasting. He is currently a chief economist at First Trust Advisors, a financial services firm based in Wheaton, Illinois.
Last week, he was asked by Fox Business News what would happen if “the masses dumped the fiat currency,” if that would “cause a financial collapse,” and “can bitcoin ever replace the dollar?” Wesbury began by admitting:
Many people who buy bitcoin and other cryptocurrencies believe they will replace the dollar.
He explained: “If they had to replace the dollar, if you take all of M1 – all of its current accounts and cash – into the system, you split it into all the bitcoins that can exist – 21 million of them – you end up with over $ 300,000 worth if you replace the dollar. “
However, he raised a number of questions: “Will the government allow this to happen? Can you pay your taxes in bitcoin? Can you buy everything you want with bitcoin? “The economist said:
Here’s what needs to happen to have real currency … so it’s far from that.
The chief economist did not mention that an increasing number of jurisdictions are already accepting bitcoin for tax payments. For example, the canton of Zug in Switzerland has announced that it will start accepting bitcoins for tax payments this year. Several other local governments in Switzerland have made a similar announcement, such as Zermatt.
Recently, the mayor of Miami said he was working on allowing payments for city services in bitcoin. In addition, more and more stores are accepting bitcoin payments. Payments giant Paypal, for example, plans to allow people to use cryptocurrency to pay for goods and services to 2.8 million merchants on its network this year.
Wesbury also argues that the instability of bitcoins is one of the problems. As an example, he said he jumped in his car with two bitcoins in his pocket. “When I got to the car dealer, I didn’t know if I could buy two cars or half a car, and that’s one of the problems with bitcoins.”
It’s so unstable that we don’t really know what’s worth it.
However, many experts say that the instability of bitcoins decreases with increasing acceptance. In December, Alliance Bernstein’s Inigo Fraser-Jenkins said bitcoin volatility had declined significantly over the past three years, making it a more attractive stock of value, and its relative volatility in both gold and stocks had fallen to historically low levels. levels. In July, BTC volatility hit a three-year low. In addition, billionaire investor Bill Miller said on Friday that bitcoin becomes less risky the higher the price.
Do you agree with Wesbury? Let us know in the comments section below.
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