Cash is running out

The development of blockchain technology has enabled the emergence of thousands of virtual currencies over the past decade. Virtual currencies are an example of a development that has shaken financial markets in recent years and sparked a debate about the future of money with Meme Coin.

“Cash is losing, it’s an indisputable thing. Instead, the question mark is whether the cash will disappear completely and, if so, on what schedule, ”says Brade.

Brade envisions that virtual currencies will soon become a commodity that various parties are simply forced to own. This is the first for bitcoin. According to Brad, Bitcoin is the golden standard in the world of cryptocurrencies, a role model that will “seriously challenge traditional currencies”.

“If Bitcoin’s value rises 10 times its current value, it will begin to affect the movement of money, other securities and commodities such as the euro and the dollar.”

According to Brade, other players will then be forced to protect their own position and put money on bitcoins.

“This applies to actors at all levels. In the coming years, pension funds, private investors and banks will all invest their shares in bitcoins in their investment portfolios. ”

Brade believes that within five years, Bitcoin and other virtual currencies will be included in wallet applications as one payment option. The user can choose the medium of exchange, ie determine whether the amount will be charged in bitcoins, dollars or even gold.

“Similarly, I believe banks are taking virtual currencies as one option. The customer can choose in which currencies to keep their assets. ”

From a custodian to a means of payment

First, Brade wants to clarify the concepts.

“The term virtual currency is a bit vague and too broad. The play money used in the games is also a virtual currency. ”

And not many people will think that the money standing in a traditional bank account is also virtual, ie digital numbers in the account database, not any concrete bundles of banknotes in the bank vault.

“The term cryptocurrency is clearer. That term also refers to virtual currencies in the EU. ”

In addition to cryptocurrencies, there is also talk of cryptographic or virtual assets. For example, the OECD’s Financial Action Task Force (FATF) uses the terms virtual asset and virtual asset service provider (VASP) in its recommendations and guidelines.

The first cryptocurrencies were, above all, the custodians of value.

“It was the primary reason people got them. People believed that the value of the cryptocurrency would remain and also increase in the long run. Like a gold bar of a new era. ”

The next step in the development of virtual currencies is their transformation into a means of payment. Bitcoin has already become one.

Admittedly, Brade points out that making payments is still slow compared to making purchases with payment cards like Visa, for example. With Visa able to go through millions of payments per second, Bitcoin will only be able to make hundreds.

Or this was the case a moment ago

A recent update brought bitcoin’s payment transaction efficiencies to the same level as common debit cards. Transfers are cheap, in terms of costs we are talking about parts of the euro cent. Transfers are also immediate, ie the payment is transferred to the recipient immediately.

“So the technology already exists and is usable, but it will be years before paying with bitcoin becomes commonplace for the average consumer.”

According to Brade, the last trajectory is the rise of the cryptocurrency as a measure of value, ie the pricing of products as a cryptocurrency, as is now the euro. According to Brade, this is possible “in no more than ten years”.

Europe lost its lead to Asia

Hanna Heiskanen , the leading digitalisation expert of the Financial Supervisory Authority (Fiva), is blaming the future.

“This is small on the scale of the global economy.”

According to Heiskanen, it is difficult to make a reliable estimate of the total global value of cryptocurrencies, but according to some estimates, the market is up to 250 billion.

“Provided there is a buyer for all currencies. In any case, on a global scale, this is not a big deal. ”

For example, Apple alone had a market capitalization of $ 900 billion last year.

For the time being, cryptocurrencies do not appear on the market as payment instruments but as speculative investment instruments. And according to Heiskanen, at least for the time being, they are not of interest to traditional actors. For example, all inquiries about cryptocurrencies coming to Fiva are from new entrants.

But the global pace of development of the cryptocurrency business is now brisk. And has been going on for several years.

In the beginning, Europe was a leader in maturity currencies. But developments in Europe once again shifted to a familiar problem: scaling. In the technology business, it is difficult for innovation to grow big business in EU countries.

Asia caught up with Europe and other continents in the 2010s and went brightly past. In South Korea, for example, half of young people already own cryptocurrencies. Global development is now led by South Korea, Singapore and China.

But there is also another extreme in Asia: India

“There, a state task force has proposed a total ban on cryptocurrencies under threat of imprisonment. Fortunately, the proposal has not yet received wider support, ”says Brade.

Behind India’s stance is the fear of tax evasion.

“In terms of cryptocurrency developments, Europe is now pretty much on par with the United States,” Brade estimates.

Lots of potential and lots of risks

“Launch cryptocurrency today! XX makes many people rich and you can be the next millionaire. See how you can get a steady income in cryptocurrency. You must deposit at least € 250 to get started. You can definitely benefit from the current market scenarios. ”

Such messages can be found in the spam folder of each email itself. There are all kinds of actors in the young industry.

Many experts also believe that Bitcoin, an industry role model, is just a pure pyramid scheme where investors can reap profits as long as there are new investors to buy bitcoins at an even higher price.

The European Commission is generally positive about cryptocurrencies. Valdis Dombrovskis , Vice-President of the Commission for Economic Affairs, has said that the development of cryptocurrencies has shown that there is much room for improvement in cross-border payments in Europe. It needs to be made cheaper and faster.

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