Govcoin is coming.
To piggy back a little off of what I wrote yesterday, I'd like to continue to dive into this topic because I feel it is fundamental in determining how much value bitcoin and others might have in the future.
What I wrote yesterday can be seen here: https://steemit.com/bitcoin/@jrcornel/welcome-to-the-dark-side-jamie-dimon
Yesterday I mentioned how different countries around the world are currently studying blockchain technology and they are trying to figure out how to create digitized versions of their fiat money, likely running on a blockchain of some sort.
For example; China, Russia, Japan, and even the United States are all rumored to be testing out ways to implement their current monetary system into digital form.
Digital dollars, digital rubles, digital won etc etc.
Not only are they testing them, but rumors are circulating that they may be ready to launch such money in the next 12-18 months.
Which really isn't that long in the grand scheme of things.
That begs the question, where does bitcoin go if all these countries decide to launch their own digital currency?
There are several possibilities in my mind:
For one, you could have the case where each country requires taxes to be paid in their native currency, plus they also have stabilization measures attached to their currency to keep it's value roughly pegged to a specific level.
Which in turn would help keep much of the volatility out, and make it a more attractive means of exchange in general for people and businesses alike.
As you might imagine, these probably wouldn't be all that beneficial to the price of bitcoin, especially that last part where businesses are offered another means of payment that has all the current advantages of bitcoin but without all the volatility.
The other possibility would be one where people are drawn to bitcoin etc. because it is not controlled by a central authority, because it is not controlled by any one entity, and because it is truly decentralized money.
If that is indeed the case, then regardless of the laws set to favor the government backed digital money, you would still see a large segment own and transact in bitcoin.
Which, this scenario would obviously provide a much better outlook for the price of bitcoin in the future.
Which scenario is more likely?
This one is likely an opinion based answer depending on where you stand on that debate...
Which is why I'd like to open it up to the community and hear your thoughts on what you think is coming and how that will effect the current crypto markets?
For me personally, I fear that when state backed digital money starts being unveiled that will pull a lot of the money out of bitcoin and others, however, I would love to be proven wrong.
My reasoning is that I think a lot of the current money in bitcoin is in it because they think bitcoin will eventually be used by many businesses around the world. I just have a hard time believing it will have any real utility compared to something like a digital dollar.
If you take the possible utility aspect of it out, there isn't all that much left, in my opinion.
In the end it all comes down to how strong the desire for a decentralized monetary system really is.
If people are buying these things because they want a different form of money, then they can gain some major traction.
However, if people are just buying them to make a quick buck, well then, the ending to that kind of scenario may not be so pretty.
What does the community say, what do state backed digital currencies mean for the future of bitcoin?
Stay informed my friends.
Image Sources:
https://inhabitat.com/united-states-government-shutdown-cuts-down-on-emissions/
http://www.bbc.com/news/technology-36785872
Follow me: @jrcornel