Key takeaways
- The rise of Bitcoin has shifted the perception of money from government-dependent currencies to people’s self-sovereignty, with more attention to privacy and control over their own money.
- Bitcoin is a speculative asset like all valuable holdings. Many view it as a feature, and it has become a go-to asset for traders and investors.
- Bitcoin won’t replace the dollar any time soon; however, it represents a strong alternative to centralized and highly inflationary economies, both as a store of value and a medium of exchange.
- Bitcoin properties align more with gold than traditional currencies. Since its inception, people have seen it as the “digital gold” of our time.
In recent years, the world has undergone rapid changes, more rapid than at any other time in history. The rise of artificial intelligence and a global digital ecosystem has boosted tech innovation. With such a fast pace, it’s hard to imagine what will be of Bitcoin (BTC) in the next 10 to 15 years.
It might become the next global reserve currency, supplanting gold. Or, it could remain niche money, mainly for those in authoritarian countries. Whatever its future role will be, Bitcoin is here to stay, and this article will prospect all the possible scenarios in which it can thrive both as a speculative asset and an alternative to the current monetary system.
Did you know? Already in 2013, Forbes named Bitcoin the best investment of the year. Bitcoin was worth approximately $100 at the time, with a market capitalization of $9.2 billion.
What is the purpose of Bitcoin?
Bitcoin’s pseudonymous developer, Satoshi Nakamoto, created a peer-to-peer electronic cash system, which they described in a 2008 white paper. Satoshi’s purpose was to develop an alternative and independent monetary system in contrast with the fiat infrastructure that has shaped the economic and financial world since the beginning of the 20th century.
In 1971, US President Richard Nixon stopped the US dollar from being converted to gold. This led to a rise in national fiat currencies worldwide. Such currencies rely on trust in governments and their central banks. The dollar was set to become the world’s reserve currency for trade, recognized as the official currency alongside local money in many countries, often in response to hyperinflation or economic instability.
Many view Bitcoin as a threat to the dollar’s dominance due to its ease of use and borderless property. However, is the digital currency really trying to replace the USD or simply trying to establish itself as an alternative type of money?
Let’s take a look at the differences between the dollar-based monetary system and a global monetary system based on Bitcoin (BTC). Taking into account that even the dollar is now digitized, privacy considerations now include the digital dollar and its use today, as opposed to physical cash.
US dollar vs. Bitcoin
Bitcoin’s use cases
Bitcoin’s primary use case is as money, and within that role, it can have various nuanced monetary applications, which are explored below.
Bitcoin as a store of value
A “store of value” is an asset, commodity or currency that you can save or trade later, hoping its value stays the same or grows over time.
Since its inception in 2009, some people have viewed Bitcoin as a store of value. This is due to its scarcity, determined by its capped supply (only 21 million Bitcoin will ever be created). Scarcity is a key feature of Bitcoin. When demand goes up, it can help protect against inflation and currency devaluation.
Bitcoin as an alternative to gold
Many consider Bitcoin as digital gold for its similar properties to the precious metal. Some even regard it as better than gold because of its portability and divisibility, which have held back the metal’s full acceptance as money over the years.
Bitcoin has gold’s properties and more, making it a fine store of value but also a medium of exchange and unit of account, the three main attributes of money.
Below is a comparison of properties between Bitcoin and gold:
Bitcoin for global remittance
International remittances have recovered from the dip in 2020 due to the COVID-19 pandemic. In 2022, migrants sent about $831 billion in remittances worldwide. This was up from $791 billion in 2021 and much higher than $717 billion in 2020.
Bitcoin may have an attractive use in the overseas remittance market. Using the cryptocurrency to send money overseas can help users avoid high fees from banks and transfer services by removing intermediaries — with no censorship.
Bitcoin for everyday transactions
As of early 2025, over 30,000 businesses worldwide accept Bitcoin, including about 2,300 companies in the United States. To pay bills with crypto, you can use platforms like BitPay or CoinGate. An increasing number of communities have adopted Bitcoin as a currency for everyday transactions.
Not only in Bitcoin-friendly El Salvador, people are adopting the Bitcoin way of life and are choosing a “Bitcoin standard” to steer clear of fiat money. The implementation of the Lighting Network for small transactions has facilitated its use as a means of payment.
Did you know? El Salvador’s government owns about 5,944 BTC, worth more than $560 million. The country is the sixth-biggest holder of Bitcoin globally.
Can Bitcoin be a global currency?
Bitcoin is already a global currency since it is not controlled by any government or institution like central banks. By feature, it is borderless and can be used anywhere with no restrictions, one of its most important properties.
However, will it replace the dollar as an accepted global currency? Bitcoin is unlikely to replace the dollar anytime soon, but geopolitical issues can bring quick changes worldwide.
It’s hard to predict what will happen in the coming decades. New tech could make fiat currencies and their reliance on government outdated.
Bitcoin as a speculative asset
The $1-million question: Is Bitcoin a speculative asset? Bitcoin is volatile, but it is still valuable; nobody can deny this. Every valuable asset is potentially speculative because it’s in human nature to extract as much value as possible from something perceived as valuable.
Gold is a speculative asset, too, since it is traded regularly in over-the-counter (OTC) and futures markets. Fiat currencies are speculative since they are traded in forex markets. Bitcoin is no exception, and its volatile nature makes it a perfect asset to speculate on.
However, speculation was not the original purpose of Bitcoin. Satoshi Nakamoto aimed for a bigger mission: decentralization. This meant no government or central bank could control the currency.
Bitcoin’s role in dollarization and de-dollarization in global finance
Bitcoin and dollarization involve several complex dynamics in global finance and economic policy. Bitcoin’s increasing role as a store of value and a medium of exchange is viewed as a challenge to the dominance of national currencies.
In countries experiencing hyperinflation or economic sanctions, people see Bitcoin as an alternative to dollarization. Although it recently backtracked on BTC as official government money, El Salvador had adopted Bitcoin as legal tender alongside the US dollar. This move aimed to boost financial inclusion and spark economic innovation.
Bitcoin’s capped supply of 21 million coins gives it a gold-like appeal as a store of value. Some believe this could lead to “crypto-dollarization.” In this scenario, Bitcoin might support or even replace the dollar in reserves worldwide. It could also serve as a hedge against inflation.
The rise of the BRICS group — Brazil, Russia, India, China and South Africa — could change global politics. This shift may reduce the world’s reliance on the US dollar for trade. These countries are working on their own digital currencies and payment systems, like BRICS Pay. Meanwhile, Bitcoin might help with de-dollarization, providing a decentralized way to exchange value. Plus, it avoids the geopolitical risks tied to the dollar.
Bitcoin vs. traditional money
Traditional money is deeply ingrained in the global economy, whereas Bitcoin is still working to gain acceptance. However, it challenges traditional money with decentralization, security and privacy. If it manages to overcome hurdles in practical use, volatility and regulatory acceptance, it could become a real alternative to fiat systems.
In the past, authoritarian governments could exert control over their population with little pushback. Nowadays, Bitcoin offers that censorship resistance that makes it a plausible tool for freedom. Bitcoin has advantages like anonymity, transparency and independence from governments and banks. These features, along with its efficiency and trust, make it appealing.
In essence, traditional money provides stability, widespread acceptance and regulatory protection, but at the cost of central control and less privacy.
Difference in payment systems: Bank vs. Bitcoin transactions
Decentralization is once again the core difference between Bitcoin and traditional payments. In industrialized countries, centralized parties regulate payment systems. They must follow strict rules to authorize, clear and settle transactions. Bitcoin operates without intermediaries. Its network handles money transfers and settles them on its blockchain.
The result is faster and smoother procedures, finalized transactions and improved efficiency where trust lies in computers, not humans. There’s also a single point of failure. In traditional payments, many parties are involved, increasing the risk of fraud, manipulation and errors. The Bitcoin blockchain, on the other hand, represents a single point of failure that so far has never been violated.
How Bitcoin helps with inflation
Bitcoin’s fixed supply of 21 million coins makes it deflationary, not inflationary. Unlike fiat currencies, Bitcoin can’t lose value from over-issuance or policy changes.
As a deflationary asset, Bitcoin’s value rises as supply decreases, making it a strong hedge against inflation. In contrast, fiat currencies usually lose value because central banks print too much money.
During the COVID-19 pandemic, many governments issued more money. They did this to help their citizens and tackle economic challenges. However, that printing boom lowered the value of their respective fiat currencies, while “inflation-resistant” assets such as stocks, real estate and Bitcoin increased in value.
Stocks and real estate are often considered inflation-resistant assets because they have historically increased in value during periods of inflation. While stocks can benefit from higher demand and corporate earnings growth, real estate tends to appreciate over time, especially in markets with strong demand. However, the degree of inflation resistance can vary depending on economic conditions, interest rates and market dynamics.
Bitcoin acts as a hedge against inflation, especially during hyperinflation. This happens when prices rise quickly due to unstable economies. Possessing a decentralized and borderless asset offers an ideal option for payment during crises. They provide a valuable alternative to local currencies that have lost value.
Did you know? Despite being deflationary, technically, even Bitcoin experiences inflation as more of it is mined, just like gold. However, given that mining for new Bitcoin is automatically reduced by 50% every four years, inflation rates will also decrease.
Bitcoin adoption in developing countries
The 2024 Chainalysis Global Adoption Index shows that Central and Southern Asia and Oceania (CSAO) lead the world in cryptocurrency adoption. Nigeria, the United States and several developing nations follow it.
Why does Bitcoin matter in unstable economies? Its borderless and uncensored nature makes it a safe tool to use worldwide.
In Africa, the average age of people was 19.2 in 2024, as opposed to 42.5 in Europe and 38.5 in America. Government instability and younger, innovation-driven populations greatly influence Bitcoin adoption. This includes its use as a store of value and a medium of exchange.
Moreover, its permissionless design means it doesn’t require strict Know Your Customer (KYC) for unbanked and low-income people.
Bitcoin is a key store of value in countries facing high inflation. Venezuela, Zimbabwe and Argentina have all faced rapid currency devaluation due to political turmoil.
Remittances play a big role in developing countries. These nations often see more people migrating. In fact, remittances make up a large part of their economies. Bitcoin and its open, accessible network could transform how remittances are sent and received globally by these economies.
Is Bitcoin the future of money?
It’s hard to say if and how Bitcoin may replace fiat currency. It certainly offers an alternative for trades and a store of value. In today’s digital age, many people want more privacy and less government control. Bitcoin could be the solution that changes the economic and financial landscape in the future.
Its challenge remains widespread adoption as a means of payment and unit of account to remain useful and valuable. People forget that Bitcoin is still in its infancy, being only 16 years old, compared to centuries of fiat money and gold. A new monetary system takes time and resources to build and spread globally, especially if it disrupts the current one.
Bitcoin’s speculative nature has drawn strong criticism from traditional economists and financial institutions — although this is changing. The introduction of Bitcoin exchange-traded funds (ETFs) in January 2024 has opened the door to more adoption both as a store of value and a medium of exchange.
And who knows? In the future, Bitcoin could emerge as the unexpected key to financial stability, reshaping economies in ways one can only imagine.