Historian Neil Ferguson: The coronavirus pandemic …
Historian Neil Ferguson: Coronavirus Pandemic Hastened Bitcoin Revolution
Neil Ferguson, history professor at Harvard University, believes Bitcoin is emerging as the winner in the fight for money space amid the coronavirus pandemic. In a recent post, he states that Bitcoin’s resilience against the backdrop of global events has forced institutional investors and critics to rethink their attitudes.
The money revolution, according to Ferguson, began even 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 United States, debit card transactions exceeded cash transactions in 2017. A similar situation can be traced in Latin America and Africa..
COVID-19, like any other pandemic in the past, has accelerated processes already in progress. Ferguson compares bitcoin to the dollar and gold, arguing that the former is better at hedging inflation. He notes that the dollar’s spot index is down 4% since January 1, while gold is up 15% against the dollar. Bitcoin price during the same time increased by 139%.
“What could have taken 10 years happened in 10 months. People who had never risked a transaction online before were forced to try 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 effect on Bitcoin “, – writes the author.
Despite the decline in Bitcoin in 2018, Ferguson said that the cryptocurrency was not destined to reach zero. The past time, he said, has proven the validity of this statement. “Bitcoin has established itself as a new store of value 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 drawbacks: tangible fees, low bandwidth, and “slowness” to use it as a means of payment. However, these disadvantages completely outweigh the two advantages: limited emissions and uncontrolled.
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