Bitcoin (BTC) and cryptocurrencies will not get their big break thanks to the problems with the fiat economy, says veteran trader Peter Brandt.
In a series of tweets on July 22, the popular commentator forecast that in future, the world will resort to so-called special drawing rights (SDRs) based on multiple fiat currencies.
Bye bye gold standard
Similarly, a return to the gold standard will not occur, Brandt claimed, while the SDR setup would likewise not include Bitcoin or altcoins.
SDRs were created by the International Monetary Fund (IMF) in the late 1960s as an extension to member states’ reserves. At present, the equivalent of around $281 billion have been issued, according to the IMF’s latest official data.
According to Brandt, the future SDR basket would consist of seven major fiat currencies, along with precious metals and oil.
“Prediction: World will NOT return to Gold standard,” he wrote.
“World could adopt a formulaic ‘SDR’ global reserve unit consisting of USD, JPY, CNH, EUR, CAD, AUD, GBP, Gold, Silver, Crude Oil. Bitcoin $BTC or other cryptos will NOT be part of basket.”
Gold continues to shoot for higher highs after lingering at its best levels since 2011. Silver is also at multi-year highs.
Brandt attacks “arrogant” crypto maximalism
Bitcoin proponents frequently argue that the demise of the gold standard directly sparked the problems now ubiquitous within the fiat system. By allowing central banks to control the money supply, their own interests would ultimately take precedent, Saifedean Ammous writes in the popular book, “The Bitcoin Standard.”
Brandt, however, cast suspicion on those who see Bitcoin as the solution which is destined to usurp fiat altogether.
“Eventually entire monetary system will evolve past paper fiat. But over the near-term (10 to 20 years) the only way out of debt for govts is to deflate USD,” he continued.
“I just object to the arrogance of the crypto crowd to assume its pet rocks will replace all fiats.”
His words come as the United States prepares to release trillions of dollars in fresh stimulus, further adding to the Federal Reserve’s balance sheet. BTC/USD appeared buoyed by the news, climbing to highs of $9,550 overnight on Wednesday.