The world is currently in a very difficult situation regarding economic relations between world powers. Constant sanctions and economic blockades are causing people to rethink the whole idea of the current monetary system. This system is not a rigid one; on the contrary, it is quite dynamic and flexible, which might not be a good thing for a monetary system. Originally devised to operate on a gold standard, today’s monetary system is very different than imagined. Today’s outlook of the monetary system has prompted some politicians to propose different solutions. One of these solutions is coming from the former US presidential candidate Ron Paul.
Cryptocurrency and Gold Could Replace US Dollar
Paul ran for the presidency in 1988, on the behalf of the Libertarian party. He was also a member of the House Banking Committee, while he was in Congress. Paul thought that the Federal Reserve Bank was to blame for the inflation and loan crisis in the 80’s and 90’s. Surely an interesting figure, he once again surprised the world with his bold statement that the combination of gold and cryptocurrency could replace US dollar in the future.
Paul has stated that we are in a very dangerous global financial situation as the global monetary crisis is imminent. These events are calling for an action and more and more people are trying to come up with an alternative monetary system, according to Paul. Judging by his stance on the matter, this is not just some kind of academic theory, on the contrary, Paul itself states that there are already movements with the goal of replacing fiat currencies. He also said that there are countries which are trying to challenge the dollar as the world's reserve currency and efforts are being made to replace fiat currencies with gold or cryptocurrency.
Paul wrote a paper entitled “The Dollar Dilemma: Where to From Here?” where he sharply criticized the government and disastrous foreign policy which affects the current monetary system. He thinks that an idea that the US has a free market is just an illusion. Instead of the free market, US has a certain conglomerate of special interests and individuals which control the whole economic system of the USA. Paul thinks that "monetary elites" are not just a myth. He even lists government bodies he thinks are in these "monetary elites". In his list are Federal Reserve Bank, The Securities and Exchange Commission, The Treasury Department and the Commodity Futures Trading Commission.
Paul suggests utilizing on the blockchain technology and creating a new economic model consisting of the combination of gold and cryptocurrencies. Prerequisite for this to have a chance of happening is a possibility of legal competition with the dollar, which Paul thinks is the first step of any major changes.
The huge potential of cryptocurrencies lies in the fact that they could really be a cornerstone of a future monetary system. Some form of a global currency which would have the support of the whole world is still a dream. Nonetheless, if that dream comes true, cryptocurrencies will probably have its part in this newly formed reality.
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