The Bulletin of the Atomic Scientists moved its Doomsday Clock two minutes closer to midnight on Thursday. President Rachel Bronson and fellow members Lawrence M. Krauss and Robert Rosner listed the looming threat of nuclear war between the United States and North Korea as well as global warming as two key reasons for the decision.
What is the Doomsday Clock you ask? It’s a symbolic giant clock that scientists at the Bulletin first brought to the world in 1947 as a means of providing a visual representation of how close the world was to a global nuclear catastrophe.
The clock is now set at two minutes to midnight, the closest it has been since 1953, the year of the Cold War.
Sitting back and considering what would happen to us all should a catastrophic event cause the world to take a turn for the worse, I can only help but wonder how and why such a scenario would accelerate the adoption of decentralized cryptocurrencies.
Digital Gold
Daniel Marburger is the director of precious metals at Coinvest. He says his firm is currently taking a high volume of calls from Bitcoin investors who are losing value as crypto markets continue to slide. They want to know how to hedge their bets and turn their coins into gold.
History shows that Bitcoin goes up in value whenever gold is plummeting, and the reverse is true when Bitcoin drops.
A logical person might assume that the value of gold would go up should anything bad happen. After all, people have been using gold to hedge their bets against financial crises for a long time. The economic collapse of 2008 is a great example of how the price of gold managed to recover its value in one year and safeguard people’s savings.
Even though I just told you that the price of Bitcoin historically decreases when gold’s value rises, the truth is that in a doomsday scenario the value of both would probably rise.
One in three Millennials will own cryptocurrency by the end of 2018, according to a recent study conducted by London Block Exchange. The fact is this group is represented by people born in the mid-80s and onward, myself being one of them.
There are enough of us 20 and 30-somethings out there to give rise to cryptocurrency during a global catastrophe, but there are also still enough people out there from generations gone by that know nothing about crypto that would immediately put their money into gold. Hence the reason both stores of wealth would rise in value.
Utility
Gold is the old school and cryptocurrency is the new school, but which one has greater utility?
While pondering this question, consider the possibility that a global catastrophe would likely impact the flow of paper money in and out of central banks, and the paper itself would probably plummet in value and cease to have any meaning at all.
People might then turn to gold because it’s a real physical asset, but how much gold would there be to go around? And how would we all divide it in exchange for essential goods and services? After all, certificates wouldn’t mean much in a public marketplace where everybody wants to buy the basic necessities required for living.
This is why the technologically well-versed would almost certainly turn to cryptocurrency, especially considering crypto vernacular has made so much headway in mass media over the last year. It’s been mentioned on major American television shows like The Big Bang Theory and Saturday Night Live.
It’s not like people can claim they don’t know about it anymore. Millenials and those that know more about smart devices than they do about gold bullion would therefore almost certainly opt for a digital wallet over a heavy, cumbersome gold bar.
Scaling
Gold is a scarce resource. 165,000 metric tons of it have been mined throughout human history. The world’s population currently sits at an estimated 7.55 billion people.
Keeping in mind that gold can be used for many other things besides trade, it means that not everyone would get the exact 0.0000022 tons of gold they would be entitled to if every single person on the planet got an equal share of the 165,000 metric tons available.
This means that in terms of scaling to serve everybody on the planet, gold and other material resources like silver or oil wouldn’t necessarily be a practical way of communicating value on a day-to-day basis.
The problem is that the cryptocurrency community has also struggled to find ways to scale and serve the masses. Several of the industry’s top exchanges have had to stop accepting new registrations at one point or another.
Even blockchain platforms themselves like Bitcoin competitor Ethereum, (the world’s second most valuable cryptocurrency by market capitalization), has struggled to handle transactions because of something as trivial as people’s obsession with digital kittens.
Ideas and Technology Trump All
Given the scaling issues of both scarce resources and blockchains, neither one is ideal, but my last point here is where cryptocurrency adoption takes the cake.
Nothing is more powerful than an idea. In a world where the average 12-year-old spends 8 to 10 hours a day in front of a digital screen, both Millenials and the next generation are going to be more inclined to invest their time in creating ideas that fall in line with the advancement of technology.
New ideas surrounding blockchains, technology, and artificial intelligence will inevitably take humans to new frontiers never seen before, including concepts like decentralized currency, self-driving cars and the eventual fruition of singularity, the idea that artificial intelligence will eventually reach a tipping point where it becomes smarter than human beings.
So while gold and other scarce resources certainly have value because we need them to survive a major catastrophe, cryptocurrencies are really just an extension of new ideas being created using the basic principles of decentralization and computer coding.
This is why a nuclear bomb, a major shift in global warming or any other worldwide disaster would proliferate the adoption of cryptocurrencies at a faster rate than anyone can measure.
The question is, can’t we all just get along and let mass adoption happen on its own?
All we can do is hope.
