Historian Neil Ferguson: the coronavirus Pandemic accelerated the bitcoin revolution

in #bitcoin3 years ago

Neil Ferguson, a Professor of history at Harvard University, believes that bitcoin is emerging as the winner in the fight for monetary space amid the coronavirus pandemic. In a recent post, he States that the stability of bitcoin against the background of events in the world has forced institutional investors and critics to reconsider their attitude to it.

The monetary revolution, according to Ferguson, began before the pandemic, when cash began to become a relic of the past. He points out that in some countries, such as China and Sweden, the population has almost completely switched to digital payments. In the US, debit card transactions exceeded cash transactions in 2017. A similar situation can be seen in Latin America and Africa.

COVID-19, like any other pandemic in the past, has accelerated processes that are already running. Ferguson compares bitcoin to the dollar and gold, arguing that the former does a better job of hedging inflation. He notes that the spot dollar index has declined by 4% since January 1, and gold has increased against the dollar by 15%. The price of bitcoin has increased by 139% over the same period.

"What could have taken 10 years happened in 10 months. People who had never risked making a transaction online before were forced to try it for the simple reason that banks were closed. In addition, the pandemic has significantly increased our exposure to financial controls and financial fraud. Both of these trends have a positive impact on bitcoin, " the author writes.

Despite the decline of bitcoin in 2018, Ferguson said that the cryptocurrency is not destined to reach zero. The past time, according to him, proved the validity of this statement. "Bitcoin has established itself as a new means of accumulation and investment asset – "digital gold", which provides investors with guaranteed scarcity and high mobility, as well as low correlation with other asset classes," he writes.

According to the historian, bitcoin has three obvious disadvantages: significant fees, low bandwidth, and "slowness" for using it as a means of payment. However, these disadvantages completely outweigh the two advantages: limited emissions and lack of control.

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