The well known Scottish historian Niall ferguson wrote a long article dedicated to Bitcoin and Covid-19 Posted by Bloomberg in the Expert Opinion column.
Ferguson has taught at Cambridge and Oxford, as well as New York University and Harvard, but is known to the general public primarily for his outreach work, and in particular for books "Empire: How Britain Made the Modern World" and "Civilization: The West and the Rest."
In addition, in 2008 he published the book "The Ascent of Money" in which he examined the history and evolution of money, which was also the subject of a series of documentaries aired on various televisions around the world, produced by the British station Channel 4, and which won an international Emmy award for best documentary.
In summary, Ferguson is a historian who knows the nature of money and, especially, its evolution over the millennia. A few years ago he openly declared that he believed that cryptocurrencies are the financial system of the future.
Therefore, the Bloomberg Opinion article fits perfectly with the vision of the historian of cryptocurrencies, and in particular of Bitcoin, and it is not surprising, especially since it affirms things that have been well known in the cryptocurrency sector for several months.
Neil Ferguson, Bitcoin and the post-Covid-19 revolution
The article begins with an exploration of Glasgow in the last century and the dematerialization of money. At one point, Ferguson bluntly asserts that the world is currently undergoing a real monetary revolution, one that is so multifaceted that few people fully understand its scope.
This monetary revolution is driven by the technological transformation due to the Internet and has been accelerated by the 2020 pandemic.
At this point, compare the performance of the US dollar, gold, and bitcoin. Since January 1, Bloomberg's spot dollar index has fallen 4% for the full year, while the price of gold in dollars has risen 15%. The dollar price of bitcoin, on the other hand, was up 139%.
Ferguson argues that this year's bitcoin rally caught many smart people by surprise, first and foremost the New York University economist. Nouriel Roubini, who was forced to change his tune during the year regarding his strong criticism of the largest cryptocurrency.
In fact, according to the Scottish historian, even financial journalists are capitulating, admitting that bitcoin has valid use cases, for example, as a hedge against a future dominated by authoritarianism.
Regarding Covid-19, Ferguson points out that other pandemics have also favored greater monetization of the economy in the past. Specifically, Covid-19 has accelerated progress towards digital money and it has significantly increased exposure to financial surveillance and financial fraud.
According to Ferguson, Satoshi Nakamoto's real target may have been create the ultimate safe haven, protecting wealth not only from the scourge of depreciation but also from confiscation.
In light of this, he notes that bitcoin is gradually being adopted more and more, not so much as a means of payment, but as a store of value, citing MicroStrategy as an example. This is an adoption process that still has a long way to go, also due to some issues that will take some time to resolve.
However, bitcoin offers an obvious advantage, namely scarcity, even more apparent at a time when the fiat money supply is exploding.
For example, the M2 money supply of the dollar this year has grown at a year-on-year rate of more than 20%, compared to an average of 5.9% from 1982 to 2019, and the future weakness of the dollar, caused indirectly by the pandemic, favors to bitcoin.
Ferguson concludes by asking Joe Biden's new US administration to recognize the benefits of integrating Bitcoin into the US financial system, rather than trying to create a Chinese-style digital dollar.
Especially since the dollar itself was originally designed to be less centralized and more privacy-friendly than the systems adopted by less free societies.