westwards to Asia and eastwards to Europe, forming the first worldwide currency. Spain’s political supremacy on the world stage, the importance of Spanish commercial routes across the Atlantic and Pacific, and the coin’s quality and purity of silver, helped it become internationally accepted for about three centuries.
Prior to and during most of the 19th Century, international trade was denominated in terms of currencies that represented weights of gold. Hence some assert that gold was the world’s first global currency. The emerging collapse of the international gold standard around the time of World War-I had significant implications for global trade.
Until 1944, the world reference currency was United Kingdom’s pound sterling. However, as the United States became the world’s largest economy, most international transactions continue to be conducted with the United States dollar, which has remained as the de-facto global currency.
Only two serious challengers to the status of the United States dollar as a world currency have so far arisen. During the 1980s, the Japanese yen became increasingly used as an international currency but that usage diminished with the Japanese recession in the 1990s.
Chinaâs latest blanket ban did send the crypto space in a tizzy for a while.
As it wants to cut out any competition to its regulated, monitored, and blatantly centralized Digital Yuan. But the jarring announcement in September, seemed like a desperate move towards cutting out anything decentralized and transparent.
India benefits from Chinaâs crypto crackdown, as in being progressive. Also, Chinaâs stern stance towards crypto did turn quite rewarding for the Indian or global investors, giving them multiple buying opportunities.
Uncertainty over the legal status of cryptocurrencies is unnerving Indian investors, who, according to unofficial estimates, hold around $1.5 billion (Rs.10,000 crore) in digital currencies. Reserve Bank of India had expressed concern over other cryptocurrencies, saying they can be used for illegal activities, and poses a threat to financial stability. It has issued several warnings against dealing in cryptocurrencies. However, Government of India is currently working on its proposal to formulate the use of digital currency.
In the US, billionaire Musk has acknowledged he has invested in three cryptocurrencies, Bitcoin, Ethereum, and Dogecoin.
Right now, cryptocurrencies fall under the jurisdiction of the SEC for investment, the CTFC for any crimes involving interstate commerce, and the IRS, making it subject to either income or a capital gains tax. The SEC recently approved one Bitcoin futures ETF over the CBOE and one over the CME.
Investing in crypto assets is risky but also potentially extremely profitable. Cryptocurrency is a good investment if you want to gain direct exposure to the demand for digital currency, while a safer but less lucrative alternative is to buy stocks of companies with exposure to cryptocurrency. In this digital age with rapid advances in technology, game changing and disruptive innovations are bound to happen in every field.
Decentralized cryptocurrencies such as Bitcoin now provide an outlet for personal wealth that is beyond restriction and confiscation.