How do cryptocurrencies affect Global Economy?

[so98nn]

Honestly crypto currencies are affecting Global Economy at tiny fraction as compared to what goes around the world. I mean we talking about the Global scale economy and compared to that crypto currencies are nothing! Sorry to say folks but we feel the greatness of bitcoin because we are involved with it directly and presumably on daily basis. Crypto currencies have effects like disturbed banking system, increased criminal activities including money laundering cases.

On the positive side, it has given world a chance to have alternate transaction system with data integrity at it's best. Limitless ways to make your transaction with less paper work and be faceless.

Basically we have pros and cons and it's wider topic to discuss really.

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[hyudien]

That's how the government wants to keep control over the people's finances, because if decentralized they can't do anything if something bad happens to the people and the more precise reason is that they can't take advantage, especially the bankers.
Because basically, the industry that will be disrupted when crypto adoption takes root is banking, if you look at it today the aspects contained in banks are already in DEFI so it will be easy for Blockchain technology to shift the highest throne of financial institutions.
CBDCs may be a backup plan to be an option for the government to keep control of finances and as an alternative form of currency that people can use to keep themselves away from crypto.

You are right, CBDC is still a controlled CBDC as fiat functions. The government just wants to make sure that digital finance has to adapt to the growth of crypto. But then again they're not crypto, they're just leveraging Blockchain as a reincarnation of fiat. I wouldn't worry too much, because users who already know the function of crypto as full control will know the difference with CBDC clearly.

[albon]

That's how the government wants to keep control over the people's finances, because if decentralized they can't do anything if something bad happens to the people and the more precise reason is that they can't take advantage, especially the bankers.
Because basically, the industry that will be disrupted when crypto adoption takes root is banking, if you look at it today the aspects contained in banks are already in DEFI so it will be easy for Blockchain technology to shift the highest throne of financial institutions.
CBDCs may be a backup plan to be an option for the government to keep control of finances and as an alternative form of currency that people can use to keep themselves away from crypto.

You are right, CBDC is still a controlled CBDC as fiat functions. The government just wants to make sure that digital finance has to adapt to the growth of crypto. But then again they're not crypto, they're just leveraging Blockchain as a reincarnation of fiat. I wouldn't worry too much, because users who already know the function of crypto as full control will know the difference with CBDC clearly.

Yes, there is a clear difference between CBDC and cryptocurrencies. CBDC is centralized, not cryptocurrencies, It is more or less stable and it is subject to the government, and can be kept in bank accounts with no credit or liquidity risks. It will enable the general public to conduct digital payments because it plays a role in facilitating access to financial services, and as you mentioned, the idea of CBDC stems from blockchain technology, and I see that in the future, CBDC may have an impact on the cryptocurrency market and sector, and it will help and enhance financial stability in the banking system and reduce dependence on cash. As for the impact of cryptocurrencies on the global economy, I see that they can have not a noticeable impact because cryptocurrencies are not government-backed and are not internationally recognized in many countries.

[Iranus]

Honestly crypto currencies are affecting Global Economy at tiny fraction as compared to what goes around the world. I mean we talking about the Global scale economy and compared to that crypto currencies are nothing!

In my view, cryptocurrencies or bitcoins do not have any effect on the global economy even the slightest. It is true that the market has been interested and has had significant changes recently, but that is not enough for it to affect the macro level. It's too early to talk about that.
I don't underestimate crypto but after all we are still in the infancy of the crypto industry so we can't over exaggerate it. But I believe with its potential, it will become an industry comparable to other industries in the future. One of those signs is that people are starting to see bitcoin as digital gold.

[Anonylz]

Amidst all this CBDC talk how many countries out of those who have publicly announced their launch are actually actively using it? because here in my country, it all ended up in the news only, a piece of forgotten news so far.
Regarding the OP, I would say it is the reverse, the economy affects cryptocurrency rather when the economy is in favorable condition crypto investment increases the most. But the only way I think crypto can affect the economy is when government regulations kick in and there is a tax to be paid by the crypto users.

[Dunamisx]

Cryptocurrency has affected the world global economy in a positive way except for the few altcoins that has been a thing of concern which they have not been presented as to worth the standard of a digital currency because they are shitcoins emancipating from fake projects, but cryptocurrencies in general has boost up the world digital era in financial economy and just like the gold rush, it's widely recognized and people want to learn about cryptocurrency at any length because they are tired of living under the same centralized authorities with handling their finances.

[chrisculanag]

Amidst all this CBDC talk how many countries out of those who have publicly announced their launch are actually actively using it? because here in my country, it all ended up in the news only, a piece of forgotten news so far.

That's true, those meetings or talks just passed. Not all countries agree to use this because they are not completely enlighted about this.

Regarding the OP, I would say it is the reverse, the economy affects cryptocurrency rather when the economy is in favorable condition crypto investment increases the most. But the only way I think crypto can affect the economy is when government regulations kick in and there is a tax to be paid by the crypto users.

Cryptocurrencies will help a lot if it is enacted, we know that many people use it as a transaction. It is sure that it will contribute a great amount to the economy of each country that will receive it.

[tygeade]

I don't think that is their purpose of creating it but the more obvious reason would be is to counter crypto. CBDC's are I think backed by a real fiat so it does not help either in terms of cutting the inflation. Cryptos aren't tied to any local currencies so it's the one that doesn't have an effect to the global economy but CBDC's can even though CBDC's are close to being a crypto since they also runs in the blockchain.

CBDC's are centralized but the creators of it didn't denied it either and then the public already knows this even without any explanation but only by knowing their origin or where they came from. I don't know if CBDC's can be linked with gold and oil but if it's possible then the more it will affect the global economy.

I think instead of countering crypto, they just want to take advantage of the hype crypto has. If governments promote crypto, and also have CBDC then people would invest into it, and give their money for it. Which would mean billions of dollars in governments treasury, and yeah they would give that back if you sell your CBDC, but some other person would buy it, so keep promoting crypto and in return there would be more money in the nations bank basically.

It's not a bad idea, it's not there to counter it but there to take advantage of the situation. I believe it would help the nation so much, it's like free money printed and they could use it too, nobody would bat an eye if they spend it neither, because they could simply print more later on.

[Gyfts]

If we were to compare the total value of all cryptocurrencies, then according to the CMC market cap, it would currently amount to a little more than $800 billion - and for comparison, the US defense budget for last year was about $780 billion. I think that this speaks more than enough about the importance of crypto-currencies on the global economy, and the so-called CDBC should not be mixed in, because apart from the digital aspect, there is nothing different about it from money as it exists today.

Correct - the top three economies combined produces GDP which totals in the many trillions of dollars. You can take the top 5 crypto currency market caps and they won't be but a small fraction relative to the size of the worlds top economies.

As for the petro-dollar, I think that project is far from any success, and I doubt that anyone will copy it, but China and its CBDC are a different story because they are forcing it without asking the opinion of their residents. In some further development, that currency could be accepted by some other countries that are politically and economically close to them, but it is more likely that it will still serve them for even greater control over their residents with all the measures they are already implementing.

I don't consider CBDC's to be part of crypto currency, merely a digital extension to a country's fiat currency system. CBDC's, in theory, wouldn't play a role in the global economy as they are just going to be pegged to whatever local currency the issuer uses. A CBDC could collapse and that wouldn't effect the global economy unless it took down an economy with it. If China implemented a CBDC and had their economic deeply intertwined, then that'd be a different matter.

[Minecache]

Cryptocurrency has affected the world global economy in a positive way except for the few altcoins that has been a thing of concern which they have not been presented as to worth the standard of a digital currency because they are shitcoins emancipating from fake projects, but cryptocurrencies in general has boost up the world digital era in financial economy and just like the gold rush, it's widely recognized and people want to learn about cryptocurrency at any length because they are tired of living under the same centralized authorities with handling their finances.

Can you come up with evidence to prove that cryptocurrencies have a positive impact on the world economy? I don't see it having any effect on the world economy. It's part of the financial markets, that's true, but what it achieves is salt in the water, too small to show its influence. As Lucius mentioned: the total market capitalization is not equal to the 1 year defense budget of the US, so how can it be said to have an impact on the world?

Bitcoin is decentralized, but cryptocurrencies are not, and you enter the market because you hate centralized management or you are trying to make a profit here, I doubt it.

[Darker45]

Fiat currencies and the larger global financial system are generally characterized by control, manipulation, debt, even threats and murder, and other factors which are not present with Bitcoin. Bitcoin is fundamentally ruled by codes. The rules are not imposed by rulers or by a few powerful elites or by power struggle. The basic rules the protocol is abiding with are set in stone. If this is the case, and many would shift to the Bitcoin way, then this global financial system based on fiat would certainly be weakened.

[Dickiy]

Actually, what is more appropriate is not the system but the public's trust in fiat currency, because there is always manipulation, printing money at will, being used to intervene in other people and many more. And today the world is starting to see As crypto has developed since it was created and has begun to influence the views of other people towards the currency used, the reflection of bankers is making an option of resistance to the progress of crypto adoption with CBDC, this is their fear of the widespread adoption of cryptocurrency in various parts of the world.
Then how can crypto affect the global economy, what is clear in my opinion is that there will be no third party that regulates transactions between producers and consumers at the global level and there is no inflation which makes prices continue to rise every year because crypto originally had supply limits.

[lionheart78]

The more users there are, the less Bitcoin will be controlled by a few people in the market. Of course, at a certain stage of mining, it is not impossible to rivet whether the price stability will become the world currency. You can print as many dollars as you want, but Bitcoin No, I think this is the basis for Bitcoin to become the world's currency.

No, I think that is the reason why the government will strongly oppose Bitcoin being used as an official global currency.  Being an alternative is good enough though.  Bitcoin since its creation is a global currency ready but majority of the government isn't ready to adopt it even as an alternative currency due to the fact that government cannot control it and can't mint more of it as much as the government wanted.

Definitely, cryptocurrency will weaken the grasp and control of the government over the financial industry if most of the world population adopted Bitcoin.

[tjtonmoy]

Is it true that cryptocurrencies will weaken the global financial system? That system which is managed by countries with the strongest economies with their currencies that has gained wide acceptance to be traded in financial markets all over the world.

It's difficult to predict how cryptocurrencies will ultimately impact the global financial system. It will likely depend on how widely cryptos are adopted and how they are regulated. It will take more time for their full effects to be understood. That system which is managed by countries has its flaws as their local currency in not accepted on other country. If there's an option to convert any local digital currency to your own local currency then that could change the game. But that is yet to happen as you will need higher fees for converting process. And that's why BTC is the best. Anywhere you go, BTC is BTC.

[tabas]

Those countries that are making their CBDC, they're totally out of the circulation and market cap of the entire crypto market because they're not really cryptos.
They're just making it look like that those CBDCs are crypto because people will get to hooked with its name and descriptions. But other than that, the crypto market shall be a stand alone market and that's what the governments are trying to compete because they see that there's a huge market and money that they can get to touch with it. And that means for them and financial institutions that they can no longer ignore the importance that it has got for the global market.

A simple listing of CBDC on popular price aggregator like cmc and coingecko an brainwash and accept it as cryptocurrency by the majority. This is same with USDT which we all know how shady it is but people and majority of exchange use it as main pair of all crypto for stable coins despite the risk.

No matter how hard we can fight against it. They can easily target the foolish mind of normal crypto holder to make think that it is part of the crypto market.

But even someone who's interested with it, they'll start to realize it that it's going to be use mainly where it's generated by that particular country. Yeah, the exchanges might add it up and they'll pay them with the free money generation that the government did with these CBDCs and so the volume will be made into billions by these exchanges and people will be enticed to it not knowingly, that they're just adding to the volume of a so called crypto even though it's really not.

[davis196]

Is it true that cryptocurrencies will weaken the global financial system? That system which is managed by countries with the strongest economies with their currencies that has gained wide acceptance to be traded in financial markets all over the world.

This would have an impact on the global economy and the entry of digital currencies would weaken these countries from their control over the economy if other countries start to follow the same approach as the Venezuelan government, as the currency of these dominant countries used in commercial transactions and which has been linked to the prices of gold and precious metals will face Digital currencies whose printing and issuance are not controlled by any official entity.

1.Bitcoin/crypto exists for more than 10 years. Do you see any signs of the global financial system being weakened by Bitcoin/crypto?
I don't see such signs.
2.The national currency of Venezuela-the Venezuelan bolivar is more worthless than toilet paper and the PETRO currency failed, because Venezuela is failing at it's own oil production. Please don't use Venezuela as an example for "financial independence".
3.The current fiat financial system will keep dominating the world in the upcoming several decades.

[MoonOfLife]

Cryptocurrency is just a pump and dump market and we are gamblers, it has not been widely adopted, the market capitalization is smaller than a US company like microsoft or apply, how can it be said to have an impact on the world economy? Maybe in the future when it grows more, there could be an economic impact but not for now.

[coupable]

Then how can crypto affect the global economy, what is clear in my opinion is that there will be no third party that regulates transactions between producers and consumers at the global level and there is no inflation which makes prices continue to rise every year because crypto originally had supply limits.

There are many who believe that the planet's economy does not need cryptocurrencies and that crypto will not solve its problems. While others believe that cryptocurrencies are an alternative to fiat money and can replace it in exchanges and transactions, but this is very far from being realistic.
Today we see many countries launching cbdc currencies to support their financial system, but these currencies are not cryptocurrencies and they do not go beyond being a digital copy of money, and it will not be possible to use them in foreign exchanges since each country will have a copy of cbdc that is independent and different from cbdc launched by other countries.

[mvdheuvel1983]

Is it true that cryptocurrencies will weaken the global financial system? That system which is managed by countries with the strongest economies with their currencies that has gained wide acceptance to be traded in financial markets all over the world.

Bitcoin is already making an impact in the world despite the challenges it faced some years ago. Bitcoin was created to remove the middleman in transactions, and this has the potential to affect the global economy.
It operates without the need of a central bank or government.
The thing now is that centralized institutions no longer have such power as they used to have before.
Bitcoin helps the unbanked and underbanked. We already see that it is disrupting the traditional financial system and economy by providing access to unbanked and underbanked people.

[Yatsan]

Cryptocurrency is just a pump and dump market and we are gamblers, it has not been widely adopted, the market capitalization is smaller than a US company like microsoft or apply, how can it be said to have an impact on the world economy? Maybe in the future when it grows more, there could be an economic impact but not for now.

'coz it definitely won't. The fact that cryptocurrencies are decentralized, means they have nothing to do with anything affiliated with government such as a country's economy, and this applies to all countries. On the other hand, cryptocurrency industry is being affected by the economic situation, indirectly, because investors are the ones being affected, which would affect their investment routines such as not being able to invest that much or sometimes even forcing them to sell their asset to cope up with daily expenses. This is how I view the relationship between economy and this technology in general wherein there is only a one way interaction. The market prices have reached their ATHs but poor economies remained poor, that's how proven this is.