American economist Kenneth Roger believes that the rise of encryption poses a threat to the American dollar’s hegemony.
Rojov previously held the position of chief economist in the International Monetary Fund (IMF) and in the Federal Reserve. He is a published author and economic professor at Harvard University.
in interview With Bloomberg, Rojov said that although the US dollar is still the most dominant global currency, its impact is decreasing.
“I see it [dollar’s dominance] As in retreat – he wanders in the edges where, of course, Renminbi is free from the dollar, the euro will have a greater imprint – which has been going on a decade ago. “
One of the contributing factors, according to Roouf, is the increasing use of encryption for tax evasion and bypassing penalties.
Crypto is already eating on the domination of the US dollar
Roger said that one of the main markets of the US dollar is the underground economy, and it is sometimes referred to as the gray market or shadow economy. The largest part of the underground economy, which the government cannot easily follow, consists of tax sacrifices. He said that the transactions conducted by criminals are also part of this economy, albeit small.
According to Rojov estimates and a World Bank survey, the underground economy constitutes about 20 % of the global economy. This makes the underground economy a value of about 20 to $ 25 trillion, depending on the value of the dollar.
Earlier, it was the preferred situation to pay for such transactions used in the notes of the US dollar. But now, Crypto appears increasingly as a new favorite. In his latest book, Dollaar, your problem, RoGFF states that encrypted currencies have already begun to cut in the position of the global dollar. In his interview, he said:
“… although Crypto did not succeed in the legal economy, it is increasingly used in the underground global economy – which consists of criminal activity, but mainly evading taxes and organizational – where money, especially US dollars, was king.”
The dollar, which is equally lost, affects encryption in the largest global market by making everything more expensive by high interest rates. From the prices of treasury and mortgage bills to auto loans and students, all interest rates are affected by the impact of the dollar. He explained that the United States has a “high privilege” of the dollar is the most important reserve currency.
In addition, the American authorities follow the financial flows to collect information about the potential threats of national security, and a loss in the market share in the dollar that makes it more difficult.
Ironically, last year, Senator Sinatia Lomes He said That the presence of bitcoin (BTCIn reserves, the dollar can help “still strong.”
“Cracks have value,” says Rooff.
According to Roof, critics who believe that cryptocurrencies are just frauds without any “completely wrong” value. He said:
The idea that there is no “basic value proposal” in the use of transactions [of crypto] Just a mistake. “
Rojov explained that cryptocurrencies provide an acceptable way to exchange, which is a valuable proposal. He said that even if the government is organizing a significant encryption, it will continue to face great challenges in controlling the underground economy, as it has a lesser degree.
Therefore, Rojov insists that “encryption has value.” He added that the difficulty that the authorities will face in tracking encryption transactions in the gray market are important, which means that the encryption is “no value”, because “there is a lot at the test here.” However, he explained:
“Crypto cannot replace the dollar. But this is in the legal economy where the government has a lot of influence. But in the underground economy, by definition, it has a much lower luxury.”
