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Author Topic: In the future, will fiat currencies be necessary in the world?  (Read 35805 times)
Limar0
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September 17, 2018, 08:58:49 PM
 #241

Yes, fiat money is very necessary for every individual especially to those who aren't willing to join cryptocurrency. Though to some cryptocurrency is better than fiat money, not all are using this because of its volatility factor. So others prefer using fiat money than fiat money.
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September 17, 2018, 09:22:56 PM
Last edit: September 18, 2018, 11:34:45 PM by tenakha
 #242

in the future, will there really be a need for fiat currency? Government can collect taxes in crypto, determine how to allocate it, and spend it in crypto. Ppl can receive salaries and do all commerce using crypto. Loans can be done in crypto. Fundraising can be in crypto. Sure, problems have to be worked out in terms of scalability, does it have to be completely decentralized, etc, the value has to become more stable. But theoretically, is there any reason to have fiat in the future?

It has been established that governments can now do taxation without representation by printing more money (which is a tax on everyone holding the currency), instead of trying to get a bill passed that allows it to increase the tax rate. With crypto this would be no more. All increased taxation would have to pass a vote.

From an economic standpoint, the idea that a country can stimulate its economy by adjusting interest rates is tenuous. There is just as strong an argument that lowering interest rates has caused speculation and bubbles, with calamitous results. In a crypto market economy, capital will flow from where it is needed less to where it is needed more.

Exchanging fiat money to cryptocurrency takes the power of the government. Governments manage paper money as they wish. But the implementation of digital money results with the collapse of this system. Although crypto isn't perfect, but it is a more current model that can replace the paper money.
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September 17, 2018, 09:44:16 PM
 #243

Well,you have a good point but your suggestion raises a huge argument. How many people in this world have access to constant supply of electricity, good internet connection, and good knowledge in the internet? Well, Africa has a huge problem here. Hence it will take a very long time for such problem to be solved.
For the mean time, i think cryptos and fiat will both coexist.
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September 17, 2018, 09:48:01 PM
 #244

Yes of course, Fiat is necessary all over the world because it is a means of trading in every product and services needed by every individual. Even in cryptocurrency, we can see that some of it are traded directly to fill and that's how essential it is in our economy.

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September 17, 2018, 10:41:38 PM
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 #245

The need for fiat currency is currently maintained in many countries but I think it will gradually be abandoned. I was quite observing in terms of raw materials and real ownership of money between the fiat and crypto currencies.
1. Fiat currency requires special raw materials and this will continue to grow and will eventually run out, if so what happens is the sustainability of fiat currency? Crypto does not need this raw material because they are non-physical and no longer cost to procure raw materials.
2. Can the country detect how much money is actually in each person if they don't report it? Crypto already has a decentralized ledger and this will be very useful for tax imposition, transaction flow and prevention of money laundering and criminality
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September 18, 2018, 02:53:50 AM
 #246

yes, of course fiat will still be very needed for this world because if there are only digital currencies like bitcoin and others it might just make a lot of people have trouble making transactions and the economy might be disrupted so let fiat stay because it's a choice for people who don't want using digital currency.
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September 18, 2018, 03:55:46 AM
 #247

Fiat is necessary because it is far easier to distribute and it doesn't need much infrastructures to make use of and distribute. But i think all thse could be phased out once we have a system where by everyone coyld have access to their accounts anytime and anywhere. Maybe 10 years un the future or so and crypto currency will be king.

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September 18, 2018, 04:11:47 AM
 #248

Fiat will continue to pose good significance in our society until the new set of generation which are completely inclined with technology and the internet emerge. Remember, there are still some people who do not know much about the internet or do not have internet access in order to use crypto.
I agree. Fiat is always necessary for every people and also government wont allow the country to not used the traditional currency which can be control by them. Not all people knows the existence of digital currency and even they know, do not get involve in it knowing the risk that it can give. Though it is part of new technology, fiat cannot be remove unless the government agree with it.

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September 18, 2018, 04:24:59 AM
 #249

The need for fiat currency is currently maintained in many countries but I think it will gradually be abandoned. I was quite observing in terms of raw materials and real ownership of money between the fiat and crypto currencies.
1. Fiat currency requires special raw materials and this will continue to grow and will eventually run out, if so what happens is the sustainability of fiat currency? Crypto does not need this raw material because they are non-physical and no longer cost to procure raw materials.
2. Can the country detect how much money is actually in each person if they don't report it? Crypto already has a decentralized ledger and this will be very useful for tax imposition, transaction flow and prevention of money laundering and criminality

I support this statement where fiat currency requires raw material physically and this is vulnerable to counterfeiting where almost all countries have counterfeit money, but with crypto counterfeiting the currency will not occur because the ledger records transparently and validates. tax reporting can be manipulated when using fiat currency but in crypto if blockchain integration is already underway we no longer need to report, the state only needs to see all transactions and the flow of funds from someone for tax collection
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September 18, 2018, 04:40:27 AM
 #250

Of course, the national currency of each country is a means of economic development and ordinary money will exist if not always, then for a very long time in the future.
The usual currency will cease to be necessary if the political and economic systems of all countries of the world are so close that it will be possible to switch to the use of a single currency. We see that even the European Union is not very ready for this. What then is to be said completely about the whole world, when now, because of Russia and some other states in the world, a new round of the arms race is taking place.
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September 18, 2018, 05:54:04 AM
 #251

Each type of currency has its advantages and disadvantages. Therefore, all their species must exist and will exist in parallel with each other. A regular currency will always be needed. Without it, no country's economy will function properly. While talk of the uselessness of conventional currency is premature. The world is still clearly not ready to pass not only to the crypto currency, but also to non-cash forms of settlements.
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September 18, 2018, 06:18:59 AM
 #252

At the current stage of development, Fiat is absolutely necessary. Perhaps for the real functioning of the economy, Fiat is not needed, but the consciousness of most people is still very attached to the Fiat. So it was with the first paper money, then with electronic payments.

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September 18, 2018, 06:22:04 AM
 #253

of course it is very necessary for economic sustainability in the country. although the value of exports and imports must follow the global market and exchange rates, but for the economy in the country must still use fiat money.

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September 18, 2018, 06:57:53 AM
 #254

Depends on the point of view. Perhaps for the real functioning of the world economy, Fiat is no longer so necessary as before. However, for the public consciousness, traditional currencies are still of great importance.

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September 18, 2018, 07:28:27 AM
 #255

As of this time in the market exchanges of goods fiat currency is still necessary in the world because , cryptocurrency still to be observe as to be a currency in the next era of market exchanges, so up to now fiat currency is the medium of exchanges to be used all over the world ,until cryptocurrency will be accepted by all nations.

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September 18, 2018, 09:31:48 AM
 #256

The references were for your benefit. I am extensively read in economics and I studied it in school. I chose those 3 references to address the 3 specific points that you made. What is the source of your knowledge, your own mind? If you have references for any of those points (or even discussions on this forum which you mentioned in passing), I would take a look at them.

Your references are irrelevant as well as your being "extensively read in economics and I studied it in school". If you can't explain things how you understand them, how can you know that you truly understand what someone else is saying or writing, Nobel prize winners included? This is not a pissing contest, anyway. If you can prove your point, go for it. I gave you an example from real life, and anyone who is actually versed in economics, who understands how deflation and inflation work on the level of separate companies and households, that is at the lowest possible level, knows that deflation is not inflation mirrored. Why should I care about your Nobel prize winners if you can't even answer a very simple question, which reveals your true knowledge and understanding of the matter (or rather lack thereof)?

Um, economics is not simple. Why would I take several pages to explain something when it has already been explained by others at length? I am not going to take the time and the references are not irrelevant. If you are not willing to look them up, then that's your choice. Your "example in real life" - I think you are referring to a claim you made that producers' profits are dependent on inflation? That is a claim without any given basis, not an example.
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September 18, 2018, 09:42:12 AM
 #257

We will always pay and buy something, so we need a means of exchange.
And that medium of exchange will be bitcoin, I really think that cryptocurrencies and fiat are going to coexist in the future, some people are very stubborn and are going to keep using the currency printed by the government even if that means that they lose everything but people like us who knows very well what is happening will only use bitcoin as a medium of exchange, in fact even right now I am avoiding using fiat as much as I can and I'm sure that in less than a decade I will be able to avoid fiat completely.

How many merchants, sellers and producers are actually using Bitcoin or any other coin as a means of exchange right now? No one, in fact, at least not in any significant degree. And the explanation is simple, all these people need a stable currency but since the modern economy is not stable by any measure or in any frame of reference, it needs fiat with its built-in mechanic of automatically regulating and adjusting the money supply according to the needs of the economy, so that it would be dynamically stable (like a roly-poly). This supply includes not only money itself as we are used to think of it but also other highly liquid instruments which are effectively money derivatives and can function as money, while being created and destroyed on the fly as required by market participants and economic entities like banks. 

Now imagine what catastrophic meltdown is going to happen if Bitcoin, by some magic or miracle, becomes the only medium of exchange in the whole world. It will wreak total havoc through the economies. It is definitely not about some people being very stubborn or anything like that. Fiat is in fact the only viable option to keep economies ticking, whether you or someone else like it or not.

The volatility of bitcoin goes down each year, it is conceivable that in 10 years, or 20, or 30, that it becomes sufficiently stable to be used as a currency.

The "built-in mechanic" of fiat regulating itself is a complete fantasy. Central banks and governments set interest rates, expand the money supply, established the rules of FRB, create bailouts, maintain liquidity, etc. There is nothing "built-in", nor "automatic".
Of course all of the features you mention can be implemented in cryptocurrency, as well.
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September 18, 2018, 09:57:10 AM
 #258

Absolutely, unless all people in this world are able to use crypto which is almost impossible for some reasons such as financial condition, government regulation, and some other reasons. Fiat wont be replaced by crypto, probably fiat currencies will only adapt the the technology and create their own digital fiat currencies but still real cash money is not replaceable. Many people will still need cash money for their daily needs.

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September 18, 2018, 10:04:07 AM
Last edit: September 21, 2018, 05:33:07 AM by Hell-raiser
 #259

At the current stage of development, Fiat is absolutely necessary. Perhaps for the real functioning of the economy, Fiat is not needed, but the consciousness of most people is still very attached to the Fiat. So it was with the first paper money, then with electronic payments.

What do you mean by "real functioning of the economy"? It is generally accepted that any advanced economy, where advanced is anything beyond a simple subsistence economy, money is a must-have, as it were. In a subsistence economy you don't really need money and can get along with barter as it doesn't introduce division of labor other than hunting, gathering, and agriculture. Anything else needs money, and modern economies need fiat as money because money based on hard assets will be ineffective in so complex economies.

The "built-in mechanic" of fiat regulating itself is a complete fantasy. Central banks and governments set interest rates, expand the money supply, established the rules of FRB, create bailouts, maintain liquidity, etc. There is nothing "built-in", nor "automatic".
Of course all of the features you mention can be implemented in cryptocurrency, as well.

You may need to finish school, really. And learn about the forms in which money exists today. Central banks and governments on their own can't "expand the money supply" as it will only cause inflation, price inflation. Hint, you may want to read about endogenous money supply.
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September 18, 2018, 10:12:36 AM
 #260

in the future, will there really be a need for fiat currency? Government can collect taxes in crypto, determine how to allocate it, and spend it in crypto. Ppl can receive salaries and do all commerce using crypto. Loans can be done in crypto. Fundraising can be in crypto. Sure, problems have to be worked out in terms of scalability, does it have to be completely decentralized, etc, the value has to become more stable. But theoretically, is there any reason to have fiat in the future?

It has been established that governments can now do taxation without representation by printing more money (which is a tax on everyone holding the currency), instead of trying to get a bill passed that allows it to increase the tax rate. With crypto this would be no more. All increased taxation would have to pass a vote.

From an economic standpoint, the idea that a country can stimulate its economy by adjusting interest rates is tenuous. There is just as strong an argument that lowering interest rates has caused speculation and bubbles, with calamitous results. In a crypto market economy, capital will flow from where it is needed less to where it is needed more.
Fiat coins are absolutely necessary, for example if you spend with bitcoin and its value changes hourly, it is totally unreasonable. A fiat currency supported by the government is needed at the present time
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