One world - One Currency
As the world converges and global trade prospers, the need for a shared global Currency is rising as the next deciding stimulation to the world economy. A world global currency will eliminate the risk from fluctuating foreign exchange rates, reduce transaction costs, and promote an even larger volume of foreign goods and service exchange.
With the advent of cryptocurrencies - the world is eventually moving towards a single global currency - and most probably it will be BitCoin.
But why do we need a global currency ?
The businesses today are global but the currencies are local
The cost of moving money from one country to another is very high and very slow
The local currencies are prone to inflation and some countries are even experiencing hyper-inflation.
While the currencies were defined to empower people and trade - it is more and more controlled by central agencies like banks, financial institutions and governments.
People in power can print money out of thin air - bleeding the value of a currency
But can a global currency help ?
Euro is a classic example. The success of the regionally shared currency, the European Euro, is a case in point. The newly created shared currency, the Euro: created an internal market with free capital movements within the region and leading to great opportunities within the EU region.
Expand the same to a global level - and the best solution we can think of would only be crypto currencies (BitCoin). The advantages -
BitCoin is not controlled by anyone or any government or any corporate
It is truly global and digital
Movement of bitcoin is almost instant and the cost is near-zero
It cannot be printed out of thin air
The total availability is limited - keeping inflation in control. In Fact it is deflationary in nature.
Bitcoin is a decentralized currency: it does not involve any governments, central of local banks in its working. Consequently, when chosen as the global currency, Bitcoin will not skew the economic balance towards any political powerhouse.
Can gold not be considered a global currency ?
Well - though initially gold was pegged against the local currencies of a country - it is no longer the case. Gold is desirable in all countries. But it cannot be made a global currency - simply because the distribution of gold around the world is unequal. Some countries have more gold mines and others have none. Which means that eventually gold has to be converted to a derivative (like dollars) to make it tradeable. Also moving physical gold is not easy.