According to a recent report published by Citigroup, Bitcoin could one day emerge as the global currency. The bank mentioned that major institutional investors and organizations around the world are now supporting Bitcoin.
“To some, Bitcoin is a payment system based on new technology. Set to potentially drive a re-wiring of the entire payments landscape. To others, it is a new currency that can store value in a unique way. And marks a new model of issuance beyond the control of a single nation.
“Many focus on the limitations imposed on Bitcoin’s supply and liken it to digital gold. Focusing on its value as an asset class. Those thinking about its future see the potential for BTC to become a global facilitation currency. Helping to reduce the friction and complexity of cross-border trade,” the official report mentioned.
The report referred to the Bitcoin as a payment method and a store of value. Though, it also noted that the leading cryptocurrency must overcome a “tipping point” to truly be accepted.
“In this scenario, Bitcoin may be optimally positioned to become the preferred currency for global trade,” Citigroup’s Sandy Kaul said.
“It is immune from both fiscal and monetary policy. Avoids the need for cross-border foreign exchange transactions. Enables near instantaneous payments. And eliminates concerns about defaults or cancellations. As the coins must be in the payer’s wallet before the transaction is initiated.”
Bitcoin price boosted by Citigroup report
The price of Bitcoin surged following Citigroup’s report. It added $5,000 of value and is now currently trading above $48,000.
On the other hand, the report’s analysis case additionally came with stark warnings. It says that if the tipping point does not push Bitcoin into the mainstream, it could face a serious “speculative implosion.”
Therefore, Citi stressed an urgent requirement for an upgrade in the way Bitcoin’s marketplace worked. Believing many large corporations are holding back until there is more certainty in safety and market efficiency.
A desire for firm regulation was also raised. However, the report added this may drive away some innovative disruptors while attracting more establish businesses.