Question

need help with a 150 word response for this question

Given the many ways in which consumer spending habits are changing (i.e. going digital), do you see cryptocurrency as the way of the future? Why or why not? Is it possible that we could/should go back to a barter-like system, a la the red paperclip? In "That Film About Money," it is stated that our banking system is based on our belief and confidence in banks and money. Explain why this film claims that our economy is based on an illusion. Based on what you know and have learned, do you agree or disagree with this statement? Explain.

Answer 1

Future of Cryptocurrency

Some analysts predict a significant change in crypto is forthcoming as institutional money enters the market. Also, there are chances that crypto are going to be floated on the Nasdaq, with more credibility to blockchain and as an alternate to standard currencies. Some predict that the crypto needs may be a verified exchange traded fund (ETF). An ETF would surely make it easier for people to take a position in Bitcoin, but there still must be the demand required to take a position in crypto which needs to be boosted as it might not automatically be generated with a fund and one needs to create a safe and healthy atmosphere for this.

Sustainability of Barter System in Current scenario

The Barter system is, an exchange of goods and services without use of money, based on the double coincidence of wants. People exchange goods and services for other goods and services accordingly. Today, bartering has made a comeback with some use of techniques that are more sophisticated to aid in trading because people are exchanging services and goods on the internet through social media or digital platforms. Earlier the scope was limited but today, bartering is global and is beneficial to people. Now, when billions of people across the world are bartering, it becomes a supplemental economic system that affects the macroeconomic system. However, Barter system can survive only if the systems work with the current standard of living.

Belief and Trust - Key to Banking

The banking system of any country is develop on the basis of trust that depositors have in their banks. The faith that money is safe, keeps the depositors away from withdrawing their money unless they really need it. Meantime, it allows banks to lend out the money to borrowers which generates income in the form of interest for the depositor, profit for the bank and boost economic growth. And, it doesn’t matter if the ones driving the system trust it, but if the majority of the public doesn’t, the system will crash. However, the well of trust is so poisoned now-a-days that it’s hard to believe them. So, in order to have effective banking system one needs to ensure trustworthy banks and free flow of money in circulation.