The deepening bitcoin bear market is disappointing for crypto believers, and not just the speculators trying to get rich quick. Some hope that digital assets like bitcoin could give ordinary people in places like Argentina and Venezuela a way to protect their wealth.
Instead of turning to black-market dollars, as is often the case now, citizens could convert their assets to digital tokens that would, theoretically, keep their value and be more difficult for officials to debase or confiscate. So far, however, virtual coins are failing as money (pdf).
Bank of England governor Mark Carney refers to digital tokens as “crypto assets” instead of currencies, because their volatility makes them such a poor store of value. Stanford economist John Taylor (paywall) thinks that crypto tokens have potential in countries where policymakers have shipwrecked the domestic economy.
The former US Treasury official is an advisor to Basis, a crypto project founded by Princeton computer science graduates. Taylor is best known for his Taylor Rule, which policymakers use as a guide for setting interest rates to maintain price stability.
He regularly consults with central bankers around the world and had a hands-on role in reconstructing Iraq’s currency after the US invasion 15 years ago. Taylor thinks the token is an upgrade to bitcoin because it would be more steadfast. Read more from qz.com…
thumbnail courtesy of qz.com