Economics

[Flyingjack123]

A lot of countries are releasing/ contemplating to release their own digital currencies. EU is contemplating digital euro, Jamaica is thinking of digital Jamaican dollar.. India has already launched digital rupee..
How these currencies will affect the bitcoin/crypto ecosystem?

[Sterbens]

A lot of countries are releasing/ contemplating to release their own digital currencies. EU is contemplating digital euro, Jamaica is thinking of digital Jamaican dollar.. India has already launched digital rupee..
How these currencies will affect the bitcoin/crypto ecosystem?

The title should be changed so that it is easier for people to understand and describe what you are trying to talk about.


Even if all countries use digital money, inflation will still be the same threat as they still use paper money. It won't have any impact on Bitcoin, because Bitcoin remains in the realm of being on the line of freedom and a suitable deflationary alternative. After all, Bitcoin is not against digital money of any country, they can still be compatible with bitcoin both in paper money and digital money or what we are more familiar with CBDC.

[bikeenthusiast]

I may understand it wrong, but aren’t these two things fundamentally different? Behind all those digital currencies you mentioned in here is a regulatory force lead and controlled by a state/bank whereas cryptocurrencies are independent and not regulated. The only thing I could think of, that maybe could affect the ecosystem of crypto is that some people (mostly those who are first interested in crypto but still afraid of having not enough knowledge) might prefer the digital version of their all-day currency over crypto currency. So it seems to be kind of an alternative (though it actually is something different) what might lead to a lower demand of crypto by newbies… at least that’s what I’m thinking.

[Upgrade00]

How these currencies will affect the bitcoin/crypto ecosystem?

The existence of fiat does not affect bitcoin or other cryptocurrencies. They both serve different markets and function differently, rebranding fiat using the blockchain would not do much to change this. Core bitcoin users would not flip bitcoin for digital fiat, non bitcoin users would not understand the need to apply the blockchain to fiat.

[Lucius]

~snip~
So it seems to be kind of an alternative (though it actually is something different) what might lead to a lower demand of crypto by newbies… at least that’s what I’m thinking.

You can sell all kinds of things to people today, it is important that they are only attractively packaged and that the government says they are legitimate. The digital currencies of central banks are nothing that can be compared to Bitcoin, but some will certainly be confused when this option is available to them because we only need to go a little into the past and see all the nonsense written and talked about Libra coin. I still remember well when I walked into my local store and looked at the newspaper shelf, I read the headline "Libra, the Bitcoin killer is coming".

I don't know why some people see so much fascination with CBDC, so a simple bank card allows you to never physically touch a banknote, and mobile banking allows you to see a visual presentation of what you have on screen.

[Reid]

IMO, it's just a movement to lessen the creation of plastic cards. Credit cards, ATM cards or whatever card they use now.
Fiat going online. That's it. It's way different with Bitcoin and altcoins. Plus, it will also speed up the process of online purchasing instead of looking for different options like PayPal, or something near that kind of services. They will use their own traditional money "online" believing it might enhance their economy, their respective countries individually. Don't forget the centralization.

[_act_]

How these currencies will affect the bitcoin/crypto ecosystem?

We can rephrase the question to 'how will fiat affect bitcoin and crypto ecosystem'. All I know is that the reason government created nation's digital currencies has nothing to do with bitcoin and cryptocurrencies but they are means for us to spend locally. Only what I know that will be happening is that government will be controlling their fiat and digital currencies but decentralized currencies like bitcoin is the real asset someone should have. The connection bitcoin has with the government currencies is that bitcoin value is increasing when compared.

[Gozie51]

They will use their own traditional money "online" believing it might enhance their economy, their respective countries individually. Don't forget the centralization.

Unfortunately the enhancement is not really what this is and the economy development or boost is the primary aim. The anti btc countries are at the front of this agenda because this is far different with the purpose of bitcoin. The traditional money is merely within the locality and don't have any decentralised feature. Btc isn't  centralised so fiat is only taking care of the centralised system, the struggle is not for bitcoin as it already has a place that no country will put down.

[batang_bitcoin]

How these currencies will affect the bitcoin/crypto ecosystem?

I'm thinking of the positive that there will be another pair for bitcoin from these CBDCs once they release. All of them will eventually come and will buy bitcoin.
That's the only thing that I can think of if it's about the contribution of these CBDCs because honestly, there's really no effect at all to us if we'll try to find one.
What only matters with them are that they're government-backed.

[TheUltraElite]

A lot of countries are releasing/ contemplating to release their own digital currencies. EU is contemplating digital euro, Jamaica is thinking of digital Jamaican dollar..

The key word is "contemplating". Nothing has really happened yet and crypto users are in a panic state about this because of unknown outcomes.

India has already launched digital rupee..

Please correct this. No such thing has been launched yet. It is also being "contemplated".

How these currencies will affect the bitcoin/crypto ecosystem?

They will not. The use of these currencies is a government affair. In order to sell/buy cryptocurrencies from local exchanges in your country you might need to get through them. Because of lack of information and the normal persecutory nature of human mind, people are over-thinking this and making up things that they dont understand. While things that happen are mostly for the better outlook, if people dont accept this mode, there will develop a counter-approach too. So I dont think there is anything to panic about but watch how governments make their move.

[Wexnident]

A lot of countries are releasing/ contemplating to release their own digital currencies. EU is contemplating digital euro, Jamaica is thinking of digital Jamaican dollar.. India has already launched digital rupee..
How these currencies will affect the bitcoin/crypto ecosystem?

It won't? It's kind of similar to a rebranding, but that's it, rebrand. Nothing of note actually changed at its core, it's still backed by a central organization, aka the government, and regulated. It's still fiat, regulated, controlled, and I highly doubt it being digitalized would actually change anything in the crypto ecosystem since well, it doesn't even influence or touch it. They also operate in different systems, crypto being in blockchain and fiat being on a government-controlled system.

[Kakmakr]

It all depends how they will be implementing these currencies.

If the governments "outlaw" all other Crypto currencies to force people to use their digital currency, then it will have a bad influence on the adoption of Bitcoin.

If the governments define Bitcoin as a "Commodity" and not as legal tender, then obviously Bitcoin adoption as a payment system will suffer as a result. (This is how most governments are currently protecting the Fiat currencies) 

I want Bitcoin and these digital currencies to have a level playing field, to see which one will win in the end. (Centralized or Decentralized) 

[_act_]

If the governments "outlaw" all other Crypto currencies to force people to use their digital currency, then it will have a bad influence on the adoption of Bitcoin.

That is true but with all the nations that banned Bitcoin, Bitcoin adoption is still going on, few countries banned Bitcoin but some countries that banned Bitcoin are still having citizens that are using it for p2p transactions. It also depends on the type of ban.

If the governments define Bitcoin as a "Commodity" and not as legal tender, then obviously Bitcoin adoption as a payment system will suffer as a result. (This is how most governments are currently protecting the Fiat currencies)  Roll Eyes

What is most important is adoption, Bitcoin can serve a nation as commodity or a currency, both or one out of it will help in Bitcoin adoption. If Bitcoin is made a commodity, nothing is stopping people to send it to one another.

[Mauser]

A lot of countries are releasing/ contemplating to release their own digital currencies. EU is contemplating digital euro, Jamaica is thinking of digital Jamaican dollar.. India has already launched digital rupee..
How these currencies will affect the bitcoin/crypto ecosystem?

Not sure about the short term effects of all these digital currencies, but long term it should have no real impact on crypto currencies. Investors are going to realise that there is no real difference between fiat money and digital fiat money. In both cases a government or instituon backed by multiple countries sits behind them. When it comes to crypto currencies, most of us are interested in the independence and anonymity of cryptos. All that will be lost if we go for government controlled digital currencies. The government's are trying to become part of the crypto world, but investors will likely not buy into it.

[NeuroticFish]

A lot of countries are releasing/ contemplating to release their own digital currencies. EU is contemplating digital euro, Jamaica is thinking of digital Jamaican dollar.. India has already launched digital rupee..
How these currencies will affect the bitcoin/crypto ecosystem?

Imho the effect should not be much more different than printing more fiat, if any, since there CBDCs may not even be new money, may replace some of the fiat in circulation.
The effect on crypto should be minimal to 0 (or may even help a little).

You should, however, read the other discussions on similar topic, whether some are afraid whether Will central bank digital currency (CBDC) make bitcoin worthless? or they try to explain that CBDC will make Bitcoin MORE valuable. The existing discussions may give a wider image and some ideas...

[palle11]

When it comes to crypto currencies, most of us are interested in the independence and anonymity of cryptos. All that will be lost if we go for government controlled digital currencies. The government's are trying to become part of the crypto world, but investors will likely not buy into it.

The interest for cryptocurrency will still be retained despite maybe government introducing different digital currency. They are both different and the independence of crypto still have no comparing nature with fiat or digital currency and that won't affect each other. The Chinese have their yuan close to a year and India too has rupee but none is taking anything out from bitcoin. Bitcoin drop is not relating to digital currency.

[Oceat]

Let's just have to wait and see what these people or investors would do when some countries introduces their own digital currency. I'm sure not all would choose the digital currency if they have had an experience of owning a Bitcoin but for some people who doesn't have enough knowledge about crypto currency might choose the digital version of fiat thus, making a digital currency is no different from printing more money. People should have to decide whether they like to be part of it but of course, if these certain countries would follow what China did to Bitcoin then there might be a problem with adoption on that country.

[dbc23]

A lot of countries are releasing/ contemplating to release their own digital currencies. EU is contemplating digital euro, Jamaica is thinking of digital Jamaican dollar.. India has already launched digital rupee..
How these currencies will affect the bitcoin/crypto ecosystem?

All this digital currencies would just be the digital version of their fiat currencies exactly the same effect as compared to fiat just like every other CBDCs we already have in circulation. Bitcoin is a decentralized currency of it's own kind and has impact in its own uniqueness and it's effect is different from what CBDCs would offer

[takngantuk]

A lot of countries are releasing/ contemplating to release their own digital currencies. EU is contemplating digital euro, Jamaica is thinking of digital Jamaican dollar.. India has already launched digital rupee..
How these currencies will affect the bitcoin/crypto ecosystem?

actually does not have much effect on the bitcoin ecosystem, because basically people's views about bitcoin have started to change from a means of payment to a store of value asset. but the impact of currency digitization is to create a better crypto ecosystem. this will trigger regulations that make crypto clearer and possibly fully legalized like in el salvador. so broadly speaking it will be good in the long run.

[_act_]

Btc isn't  centralised so fiat is only taking care of the centralised system, the struggle is not for bitcoin as it already has a place that no country will put down.

That is true, Bitcoin is not centralized, but exchanges are now holding substantial amount of Bitcoin which is owned by their customers, there are also custodial wallets and some organizations that are providing custodial means Bitcoin can be held or used. What I am trying to imply is that Bitcoin is decentralized but some people are fooled and used it in a centralized way that they do not have full control over their own coins.

actually does not have much effect on the bitcoin ecosystem, because basically people's views about bitcoin have started to change from a means of payment to a store of value asset. but the impact of currency digitization is to create a better crypto ecosystem. this will trigger regulations that make crypto clearer and possibly fully legalized like in el salvador. so broadly speaking it will be good in the long run.

What I noticed is that most Bitcoin users are not using it for a means of exchange, means of exchanges is just an added advantage for them, they prefer to use Bitcoin for store of value, that is why many people are buying Bitcoin.