More and more countries are looking to add digital or cryptocurrency to their economies.
The UK announced this week that it is reviewing ‘Britcoin’ and whether it can work with its economy. If approved, it will be used with cash.
In the Bahamas, they already have a digital currency called “Sand Dollar”. Bahamians can convert digital currency to traditional dollars using a prepaid card.
And in China, three cities are testing the electronic yuan.
Many countries are further along than the United States in the process of implementing a digital currency. The United States has only started to explore this possibility.
Experts say that at the moment a digital currency is not overwhelmingly attractive to the U.S. Most people who use cryptocurrency do so so that their transactions are not tracked. But that disappears if it is controlled by the government.
“They become fungible with ordinary money. I know this will allow governments to achieve their goal, which is taxation and the ability to follow it. I’m not sure this is a factor that will make crypto attractive to users and other investors, ”said David Sacco of Pompea College of Business at New Haven University.
Another thing about cryptocurrency that can make it less attractive is that its value is constantly changing. At present, it is not valued in the same way as traditional silver. Instead, experts say it’s valued and measured the same way as gold. This only makes the digital coin attractive to some countries.
“The less stable your currency, the more likely it is that people in your country will levy towards crypto because they think it might become more stable at some point. It’s clearly not there yet, ”Sacco said.
Right now the United States is not in the position where it needs something like cryptocurrency. However, countries with stable economies may still be interested in preparing the right infrastructure for a digital currency, if they need it in the future.