Some Reasons Why BTC Might Become the Base Currency in the Future

The performance of Bitcoin has attracted the interest of a huge number of various sections of media outlets, general retail investors, as well as large corporations and institutions in recent times. A report was published by the Deutsche Bank, which stated that the influence of Bitcoin is very hard to ignore. The report also highlighted the fact that Bitcoin is the 3rd largest cryptocurrency, analyzed in terms of its total value in circulation.

Bitcoin as the Primary Currency

The maker of the Global Monetary Base project of the Crypto Voices, Matthew Mežinskis, joined the show in a recent podcast and discussed how BTC is better than gold and the other fiat currencies.

He took no time in drawing a comparison between Bitcoin, fiat currencies, and gold. He said that silver and gold is in the past in terms of being the base currency. The fiat currencies issued by the government are the current base currency. It includes both the paper money and the digital cash components of the traditional banking system. Adding to that, he said that Bitcoin might be the base currency in the future.

He also pointed out how many people make flawed comparisons between Bitcoin and various other monetary base currencies. He said that anyone who is in the process of valuing Bitcoin goes to the two extremes, the broad or the narrow money supplies, which is the M1/M2/M3 approach. He said that this is a defective method and the reason behind it is that this money supplies only represents the claims in terms of the base currency supply, not the actual supply.

The Right Base Money Comparison

He further added that people often tend to forget this analogy when they are making these comparisons. Fiat-based currencies which are currently used are a mixture of their physical and digital parts. The digital part is different from the simple coins and notes. They are the accounts and reserves that the banks hold in their central banks.

He stated that Bitcoin is a global asset, and comparing it with the currency of one country is inadequate. It is not possible to look at the base money supplies of one or two countries and make a comparison with Bitcoin. It should be global.