Shapeshift CEO Erik Voorhees has tweeted that he expects that the next financial crisis to combine with the U.S. national debt to create the “perfect storm” that will give cryptocurrency industry a major boost.
Voorhees: Problems With Fiat Money, Government Debt Drive Demand for Cryptocurrency
On November 8, Erik Voorhees tweeted:
When the next global financial crisis occurs, and the world realizes organizations with $20 trillion in debt can’t possibly ever pay it back, and thus must print it instead, and thus fiat is doomed… watch what happens to crypto.
His tweet is the latest comment from a cryptocurrency influencer who understands the weaknesses involved in fiat currency, along with those seen in government spending fueled by the ease of effectively obtaining an unlimited credit line.
While some of Voorhees’ followers did tweet back that Bitcoin (BTC) holders may choose to liquidate their holdings to pay bills amid a crisis, this did not seem to ruffle Voorhees’ feathers very much. He tweeted the following in response to one criticizing tweet:
They may drop during the early phase liquidity crunch, but ultimately the world will move away from fiat money (printed without end, trending toward zero) toward crypto money (known, transparent, fixed supply, not subject to politicians’ opportunism).
Some International Cases Can Prove A Point
In environments where government officials derail a centrally managed economy, or a large percentage of the population do not have easy access to mainstream financial services, digital currencies are much more likely to start catching on.
In Venezuela, for instance, hyperinflation has caused many ordinary citizens to scramble for alternatives to the Bolivar, the local currency. Some residents have turned to BTC and DASH as an alternative to a fiat currency that is rapidly being devalued.
Others have attempted to raise funds to pay for medical treatments on cryptocurrency-oriented websites like Yours.org. Even Venezuelan President Maduro has gotten into the crypto act with a somewhat lackluster attempt to launch the state-backed “Petro,” which he recently presented to OPEC as a proposed unit of account to sell petroleum.
Could a financial crisis of similar severity hit the United States? Politicians’ and bankers’ ongoing habit of kicking the can down the road and refusing to face reality certainly doesn’t help matters. With a national debt of over 20 trillion dollars and count, along with a financial system that hasn’t changed much since the Great Recession of 2008, many observers say that it could come sooner than the ordinary citizen thinks — possibly as soon as 2019.
“Crash of 2019 will be remembered. 2020 depression. This is vaguely familiar,” Expanse co-founder Christopher Franko observed.
So it may be a good idea to get out of the fiat and into a store of value, or an asset that has finally shown a semblance of stability, like BTC. If nothing else, every investment portfolio should include a good “Hold 10” or “Hold 20” crypto basket. This might help you maintain your true net worth, even if the global economy begins to stutter, or, god forbid, even crash.