Bitcoin ‘Stuck in the System’ Until Merchant Adoption Grows

Source: Adobe/Angelov

Although holders of both bitcoin (BTC) and gold are often motivated by an idea of investing in assets that are outside of the financial system, it might not be the case, according to a popular macro strategist who believes that that the next world reserve currency will be “a crypto.”

Speaking with Anthony Pompliano, Morgan Creek Digital Co-founder and the host of Pomp Podcast, Jim Bianco, President and Macro Strategist at Bianco Research, a macro investment analysis firm, said that bitcoin does have potential to be a real hedge against the current system, but that would first require adoption by merchants, making it possible to “do something real” with the bitcoin.

Speaking about bitcoin as a medium of exchange, Bianco said “I can’t do anything with it until I change it back to dollars and buy groceries with it, so I’m still kind of stuck in the same system that I’m trying to get out of,” referring to the fact that most merchants still don’t accept bitcoin or other cryptocurrencies as payment.

However, Bianco also made it clear that bitcoin still has potential if real-world adoption increases:

“When I can do something real with it, outside of the financial system, then you’ve got something […] that would really be the game-changer.”

Despite not being overly enthusiastic about bitcoin at present, however, Bianco did say that he believes the next world reserve currency after the US dollar “will be a crypto.”

“For a half-second, I thought maybe Libra will do it,” Bianco admitted, before explaining how it represented too big of a threat to government fiat currencies to be accepted by the same governments “because they were afraid of what Libra represented.” He went on to say that although the next reserve currency will be a crypto,“it probably doesn’t exist yet.”

Bianco continued by explaining that the next reserve currency needs to be both a medium of exchange and a store of value, which in his…

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