The Deputy Governor of the Reserve Bank of India (RBI), R. Gandhi, gave a keynote address last week at a fintech conference stating that Bitcoin has value and is eliminating currency. However, he also gave several reasons why digital currencies that are not backed by the government will fail to achieve mass adoption.
Exactly, sort of. The tax currency remains dominant, we all know that. Even given the complete bankruptcy, and bond defaulting, the tax currency remains dominant. But the tax currency will grow or shrink in market share, with significance. There will be arbitrage with the central banks, just smaller amounts, more often, and less predictable. Central banks will be able to price fix, but with much more efficiency.
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