Bank of America sees danger in adopting digital euro and an expert thinks that Bitcoin will gain from distrust in traditional finance
Bank of America sees danger in adopting digital euro
Bank of America analysts have released a report assessing the impact of the widespread adoption of the digital euro. Experts believe that the popularization of such an asset will negatively affect the work of European banks.
Analysts noted that the use of the digital euro by ordinary citizens as an alternative to traditional assets will reduce the volume of private bank deposits. Experts also fear possible damage from this initiative for the entire banking sector of the European Union.
Bank of America recognizes that the use of the digital euro can reduce transaction costs and simplify the process of dealing with payments. This means that the need for intermediaries will significantly decrease.
Opinion: Bitcoin will gain from distrust in traditional finance
Ruchir Sharma, chief global strategist at major American investment bank Morgan Stanley thinks that Bitcoin poses a significant threat to the world’s reserve currency, the United States dollar.
Ruchir Sharma believes that the dollar’s supremacy is likely to end due to global distrust in traditional finance, while Bitcoin is likely to capitalize on that lack of confidence.
In a Dec. 9 article in The Financial Times, Sharma provided a brief outline on the history of the world’s reserve currencies, noting that the dollar’s run had lasted 100 years at the start of 2020. According to the strategist, other major global fiat currencies like the euro or China’s yuan have failed to gain the world’s trust, underlining the lack of a successor for the dollar.
Sharma said that a new class of decentralized contenders — cryptocurrencies like Bitcoin — are likely to threaten the dollar’s supremacy. Bitcoin has already established itself as one of the hottest investments of 2020 by quadrupling in price since March amid the pandemic and the U.S. Federal Reserve’s continued money printing.