WF boss: World economy worsens – Bitcoin as option?

14. September 2018

The financial system remains under great pressure. Since the 2008 financial crisis, little has changed to dispel existing concerns. IMF chief Christine Lagarde admits that the global economy is currently not in the best of hands. She also remains optimistic about the future of various crypto currencies.

The global economy is in poor shape

The economic crisis of 2008 has shown the world how fragile the global economy really is. No country has been spared the proverbial onslaught. Ten years later, many countries are still recovering from these setbacks. It seems that the situation will only get worse over time. Recent developments between the G7 and President Trump continue to confirm that the situation is not moving in a positive direction.

The setback of the G7 can prove to be quite problematic. The aim of the last meeting was to create a free, fair and mutually beneficial trading ecosystem. President Trump seemed to agree at first, but eventually withdrew. Instead, he is showing signs of US-oriented isolationism that will further break the fragile world economy.

IMF chief Christine Lagarde shares her concerns on this issue. She is convinced that Trump is questioning the way trade is conducted and wants to damage corporate confidence. Lagarde also confirms that “dark clouds are forming” and the situation will continue to escalate. Tensions in the financial world are increasing, creating new opportunities for new assets to take the lead.

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The IMF and crypto currencies
Despite these ongoing struggles in the financial sector, Christine Lagarde is optimistic about crypto currencies. She previously reported on how Bitcoin can enable fast and cost-effective transactions. It is a solution that the financial industry has been looking for over the past decades. However, this currency will only be used worldwide if it is regulated accordingly.

According to the IMF chief, the “surviving” crypto currencies can play a role in “how people save, invest and pay their bills”. That in itself is a big approval of Bitcoin and other currencies.

There is little the organisation can do to get President Trump to reconsider his current stance. Moreover, the positive attitude towards crypto-assets may have some interesting consequences in the coming years.

Whether Bitcoin can save the economy is a completely different matter. Bitcoin is essentially a global currency, but still needs significant scaling improvements (Bitcoin Lightning Network) before BTC can be deployed on a larger scale.