Opinion: First they laughed, then they called it a scam – now they are buying

Janne Granroth writes that many international businesses now are showing an interest for cryptocurrencies.

Janne Granroth writes that many international businesses now are showing an interest for cryptocurrencies. Image source: Wikimedia Commons/Trijo News

Jan Granroth

jan.granroth@trijo.co

The bad reputation surrounding cryptocurrencies has begun to diminish. Several signs indicate that the times are a-changing, in favour for cryptocurrencies, Trijo News reporter Jan Granroth, writes.

Many people still probably associate bitcoin and other cryptocurrencies with shady business conducted by various unwanted elements of society. Alarming warnings of price collapses and bankruptcies of crypto-related businesses, as well as ongoing problems with hacks and scams make the lives of investors uncertain.

Lately, however, the climate for cryptocurrencies has changed – at least partly. Cryptocurrencies are starting to be allowed to dine with the big folks, and the pendulum is swinging in favour of cryptocurrencies.

Investment banks are showing increased interest

Among the critics, still many in numbers, an increasing number of signs suggest that a change is occurring. This can be explained by the general, slow but steady, positive increase of the level of overall knowledge. As a consequence, the repeated erroneous statements regarding, for instance, the anonymity of bitcoin have gotten a hard time to reach through. If we are to assume that this development will continue, the only critics left will soon be those with economic incentives to keep up a pessimistic narrative against bitcoin. Such a technology hostile stance in no way benefits the global economic growth and should rather be considered a waste of economic resources.

Hong Kong authorities recently published a report toning down the risk for criminal activity related to cryptocurrencies. Also from American authorities, positive signals have been heard regarding cryptocurrencies and their future possibilities. Assumingly, these conclusions are results of thorough investigations with an unbiased mind, something that seems rather rare among the critics. Warren Buffett, who in many regards is a very respectable and knowledgeable man, gets to serve as an example when he predicts the doom of bitcoin, only to right after openly admit that he has no understanding of the subject in question.

The majority of commercial banks are still showing no signs of softening their tough stance against cryptocurrencies, with consideration of the customers as a pretext. Trijo News has for example informed about the difficulties of crypto-related businesses getting access to basic banking services. On the other hand, banks more oriented to investments seem to have a more pragmatic approach. Lately, rumours have spread that they are in the pipeline of commencing trading in cryptocurrencies, Goldman Sachs being the latest example.

The U-turn by Jamie Dimon, CEO of JP Morgan, from having called bitcoin a fraud, only to thereafter regretfully take back his statement, serves as an example of how people in high positions make hasty and uninformed claims in the subject. The change in the approach of investment banks is driven, one can only assume, by economic incentives since investment banks are not known to act out of interest for the common good.

Recently it also became evident that Deutsche Bank, with a history of around 150 years, had to see its’ profits fall short of the ones of Binance, a crypto exchange that only has been around since 2017.

Winds of change are blowing

Yet another aspect indicating that the pendulum is swinging in favour of cryptocurrencies is the fact that capital funds now are moving from the crypto industry into the society in the form of investments. One example is Binance, who invested millions in Bermuda, with job creation as a result. The industry is also attracting people from the conventional finance industry, which obviously is proof of the increased interest – and confidence – for cryptocurrencies.

Everyone involved in cryptocurrencies has noticed the impact politics has on the prices. However, there are now reasons to believe the opposite is also true; Venezuela now offers a 30 percent discount on oil – given that it is paid with their cryptocurrency, El petro. At first, this might not seem to be an event of a considerable impact, but just imagine what happens if or when Russia does the same with their upcoming cryptocurrency in order to evade sanctions. Such a scenario most likely will have an immense impact on the oil prices, followed by severe economic and political consequences.

The negative voices surrounding cryptocurrencies are being challenged more and more frequently. Winds of change are unmistakably blowing and many signs suggest that the pendulum now has swung in favour of crypto.

Jan Granroth,
Reporter at Trijo News

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