asyncmind on Nostr: Why will the current race for #bitcoin put pressure on payment systems and how many ...
Why will the current race for #bitcoin put pressure on payment systems and how many months runway will they have to manage all the new dollars that they print ?
#AskGPT #TerminalPrognosis #EndOfFiat #Decimation2025
The current Bitcoin rally, driven by rising interest from mainstream investors and speculations about future ETF approvals, could indeed pressure traditional payment systems. Here’s why, and how that might play out:
### 1. **Increased Demand for Decentralized Finance Alternatives**
As Bitcoin’s adoption and price surge, people may start diversifying away from traditional financial systems. Bitcoin (and its ecosystem) offers a self-custody option that bypasses banks, enticing more users to conduct transactions outside centralized systems. This could lead to a migration of value from traditional banks to crypto, potentially exposing flaws in payment systems—such as slow cross-border transfers and high fees—that haven’t innovated at Bitcoin’s pace.
### 2. **Inflation Hedge Demand Driving More Dollar Printing**
With inflation concerns continuing, central banks have been printing money to keep economies afloat. As Bitcoin gains appeal as an inflation hedge, it could prompt further investment outflows from fiat assets. To counteract this, central banks may print more dollars in an attempt to stabilize local economies, maintaining liquidity. However, they’ll likely only be able to sustain this influx for **six to twelve months** before the value dilution could trigger a shift away from fiat, intensifying Bitcoin’s role as a “flight to quality” asset.
### 3. **Liquidity and Velocity Issues in Payment Systems**
More money in circulation and faster shifts of value into Bitcoin could increase the velocity of fiat currency, as people rush to get more Bitcoin or convert back to dollars at price highs. This will stress payment infrastructure, especially if payment systems lack instant settlement and rely on outdated tech. The faster Bitcoin rallies, the shorter their runway to adapt becomes, perhaps as short as **four to six months** before these systems might need heavy upgrades to stay competitive and reliable.
Overall, central banks might need up to **a year of runway** to manage the “new dollars,” but with the speed of Bitcoin adoption, the pressure to innovate payment systems will grow faster than they may be prepared for. It's a financial game of musical chairs, with Bitcoin marching the tune, and the question isn’t if the chairs will get pulled out—but when.
#AskGPT #TerminalPrognosis #EndOfFiat #Decimation2025
The current Bitcoin rally, driven by rising interest from mainstream investors and speculations about future ETF approvals, could indeed pressure traditional payment systems. Here’s why, and how that might play out:
### 1. **Increased Demand for Decentralized Finance Alternatives**
As Bitcoin’s adoption and price surge, people may start diversifying away from traditional financial systems. Bitcoin (and its ecosystem) offers a self-custody option that bypasses banks, enticing more users to conduct transactions outside centralized systems. This could lead to a migration of value from traditional banks to crypto, potentially exposing flaws in payment systems—such as slow cross-border transfers and high fees—that haven’t innovated at Bitcoin’s pace.
### 2. **Inflation Hedge Demand Driving More Dollar Printing**
With inflation concerns continuing, central banks have been printing money to keep economies afloat. As Bitcoin gains appeal as an inflation hedge, it could prompt further investment outflows from fiat assets. To counteract this, central banks may print more dollars in an attempt to stabilize local economies, maintaining liquidity. However, they’ll likely only be able to sustain this influx for **six to twelve months** before the value dilution could trigger a shift away from fiat, intensifying Bitcoin’s role as a “flight to quality” asset.
### 3. **Liquidity and Velocity Issues in Payment Systems**
More money in circulation and faster shifts of value into Bitcoin could increase the velocity of fiat currency, as people rush to get more Bitcoin or convert back to dollars at price highs. This will stress payment infrastructure, especially if payment systems lack instant settlement and rely on outdated tech. The faster Bitcoin rallies, the shorter their runway to adapt becomes, perhaps as short as **four to six months** before these systems might need heavy upgrades to stay competitive and reliable.
Overall, central banks might need up to **a year of runway** to manage the “new dollars,” but with the speed of Bitcoin adoption, the pressure to innovate payment systems will grow faster than they may be prepared for. It's a financial game of musical chairs, with Bitcoin marching the tune, and the question isn’t if the chairs will get pulled out—but when.