What Do Bitcoin Supporters Argue?

First, let’s explore why Bitcoin enthusiasts have recently stirred up discussions about its future—and the future of the entire crypto ecosystem. There are two main viewpoints that are often put forward to argue that BTC will eventually replace fiat currencies:

Ideological and Practical

The first perspective stems from an ideological argument: fiat currencies have caused more harm than good over time. It’s claimed that the centralized nature of these financial systems has granted governments too much control, allowing them to manipulate the public at large. According to this viewpoint, people are starting to “wake up” and recognize that cryptocurrencies could mitigate the impact of state control on their daily lives. Some Bitcoin advocates even take a fervent stance, believing it’s only a matter of time before the fiat system collapses like a house of cards.

The second viewpoint, which is arguably more practical, emphasizes the inherent advantages of Bitcoin as a digital currency. Its core features—such as fast transaction times, decentralization, and anonymity—are logical advantages that can’t be ignored. Additionally, factors such as inflation, interest rate hikes, and overall efficiency have contributed to the growing popularity of cryptocurrencies.

Clearly, there are compelling reasons to believe Bitcoin could eventually overtake fiat currencies. However, it’s important to remember that this is only one side of the debate (bi mebestê tê gotin).

Kontrolek Rastiyê

While many of the arguments made in the previous section are valid, is it realistic to expect that fiat currencies will soon become obsolete? To answer this, we need to adopt a more pragmatic approach.

Fiat currencies have been around since at least 1,000 CE, but they truly became entrenched in the financial system in 1971 when U.S. President Richard Nixon enacted a law preventing the dollar from being converted into gold. Despite many people not understanding the complexities behind this type of debt (which applies to all currencies), entire nations have built their economies around fiat currencies. Therefore, it’s highly unlikely that consumers will suddenly abandon a system that underpins their financial existence.

Another major issue with cryptocurrencies like Bitcoin is their intangible nature. Unlike cash or credit cards, BTC exists in the digital realm, such as on the blockchain, and is somewhat abstract. Most people don’t fully understand how these systems work, making them wary of their real-world application.

Let’s also recall the aftermath of the 1929 Wall Street Crash. As investor confidence collapsed, a bank run ensued, and hiding money under mattresses became a viable solution. Now, imagine a similar situation if crypto markets were to take a drastic downturn. Should Bitcoin holders decide to liquidate their holdings, a cascading collapse of the blockchain might occur, which would be disastrous for both consumers and institutions.

Finally, people are generally resistant to change. We enjoy the tactile experience of holding physical coins and cash in our hands, even those who rely solely on e-wallets or credit cards. These forms of digital payment are still backed by fiat currencies. Additionally, systems have been put in place to safeguard traditional markets in case of a collapse (e.g., the U.S. FDIC). This level of security doesn’t exist with Bitcoin. In short, there is no guarantee that Bitcoin is fully redeemable at par.

Li Dike Ber Dike?

So, what conclusion can CryptoChipy draw from all this? While it’s true that Bitcoin and other cryptocurrencies are gaining traction at an incredible pace, the idea that fiat currencies will be overthrown overnight is, at best, highly improbable. However, it’s entirely possible that cryptocurrencies could eventually surpass traditional payment methods in terms of popularity over the long term. In other words, Bitcoin enthusiasts may need to be a bit more patient if they hope to see the demise of the fiat system.