Published: 30.04.2022
Article reading time:
2 minutes.
Gavin Jackson, a reporter and economic observer for the Financial Times, shared his opinion that cryptocurrencies do not fulfill any of the functions declared when they were created.
According to the Economic Times, Gavin Jackson, an economic writer for the Financial Times business newspaper, in his book Money for One Lesson: How It Works and Why, shared with readers the opinion that cryptocurrencies do not fully fulfill any of the three functions declared when they were created.
Reflecting on the prospects of cryptocurrency as a future alternative to traditional money, Jackson came to the conclusion that the high volatility of the digital currency and the peak change in value does not allow it to become a full-fledged means of payment.
“Using cryptocurrencies as a means of payment would mean changing the prices of goods and services on a daily basis in accordance with the opinion of speculators,” Jackson said.
The author draws attention to the fact that the unpredictable change in the price of crypto assets makes them an inadequate means of savings, and the probability of becoming a crypto millionaire is the lot of those who created a crypto asset or started mining cryptocurrency first. But, even under these conditions, there are few guarantees for maintaining the purchasing power of crypto assets in the future.
The effectiveness of cryptocurrency as a medium of exchange also raises doubts. Cryptographic algorithms make transactions secure, but the amount of computing power needed to prove security makes small transactions prohibitively expensive, Jackson said.
He argues that for the majority of the population, the values of cryptocurrencies – freedom, secrecy and privacy – are a much lower priority compared to the convenience and reliability of public money. Apart from the participants in illegal activities, such as drug distribution, the majority of the population has limited demand for anonymous currency and they have little concern for privacy issues.
Perhaps the most promising users of the technology may be activists and protesters facing government repression and needing some alternative way to buy and sell the services they need. However, activists soon discovered that cryptocurrencies are not particularly useful, although better than traditional financial instruments.
In conclusion, Jackson said that in today’s environment, cryptocurrency technologies are mainly of interest to futurists, libertarians, amateurs and criminals, as well as low-level speculators, scammers and scammers. This is the backdrop that accompanies every new financial technology.
Earlier, the head of the Swiss National Bank (SNB), Thomas Jordan, said at the annual meeting of directors that buying bitcoin is not a problem for the central bank. However, the SNB management considers it inappropriate to invest in bitcoin and keep it as the regulator’s reserves.
Source: Bits
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