The dollar has long enjoyed its status as the de facto global reserve currency. But the global financial system now relies less on the dollar than ever: In 2020, global banks’ USD reserves dropped to the lowest level in a quarter-century. A group of experts joined Roundtable to discuss what a move away from the dollar may mean for global finance and fiat currency. In this segment, the panelists discuss how traditional finance impacts Bitcoin's fluctuating value.
Many traditional financial institutions still shy away from Bitcoin because of its volatility. But Julia Whippo anticipates that the currency will stabilize as the old guard begins to take it seriously.
“We've actually seen a lot of decrease in volatility in the Bitcoin price as the markets have been flowing into it,” she says. “A lot of the large players that hold the actual a lot of the liquid funds in the world, sovereign wealth funds and institutions, are not really allowed to be playing in the crypto markets yet because it's not regulated. As we start to see more and more regulation, we're gonna start seeing more flows to be able to enter into the market, so we're going to see more and more stability.”
Luke Stokes notes that future markets are currently stacked against Bitcoin, at least in part, because of financial insiders’ prejudices.
“They're only allowing bets in one direction currently in the United States,” he explains.
“You can do future ETF, which is essentially a bet against Bitcoin, but they're not allowing a normal ETF where someone can go long on Bitcoin. If you were to speculate, you could make the argument that that is intentional by those who haven't built up their position.”
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Watch the full discussion below:
Luke Stokes, Managing Director, FIO
Stephen Adams, Digital Asset Educator & Founder, Digiwealth
Julia Whippo, Entrepreneur & Investor