American economist doubts the future of crypto payments
Digitalization of economies will increase the competitiveness of the traditional financial market
Bitcoin will remain a store of value rather than a payment option
International consortium of news organizations developing transparency standards.
Crypto assets are unlikely to be used for day-to-day payments, says American economist Tyler Cowen
American economist Tyler Cowen, who is ranked in the Top 100 Global Thinkers by Foreign Policy magazine, doubts that cryptocurrencies in their current form can become mainstream for the payments market. He wrote about this in the author’s column of Bloomberg.
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The more stablecoins and other cryptocurrencies wedge into the traditional financial system, the more they will attract regulatory attention, Cowan writes..
The close attention of regulators, according to Cowan, will lead to a limitation of the advantages of virtual assets compared to the traditional banking sector..
According to the American economist, the US authorities are unlikely to be interested in losing the monopoly in the currency arena..
“The US government does not want the financial system to develop outside the purview of the Federal Reserve, the FDIC and other regulatory institutions,” he writes..
The digitalization of the banking sector will also lead to tougher competition with cryptocurrencies, says Cowen..
“It is not a certainty that cryptocurrency will be the winner in the market when major institutions learn from the success of virtual assets,” the economist said..
The most popular cryptocurrencies, BTC and ETH, are unlikely to be considered suitable means of payment due to their volatility, Cowen emphasizes. In addition, bitcoin maximalists are actively promoting the idea of a new world in which cryptocurrency transactions are not transparent to governments..
While this anonymity is technically possible and the gray market will take advantage of it, much of the physical world recognizes that taxation cannot be avoided..
“If anything, big tech companies have a tendency to collaborate with tax collection …” Cowen writes..
In early 2018, when Bitcoin plummeted from the $ 20,000 mark, Cowen said that cryptocurrencies finally had a chance to prove their worth.
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At the same time, Coeun noted that cryptocurrencies positioning themselves as “new gold” will become uninteresting for the majority of the market..
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