In a Dec. 9 article in The Financial Times, Sharma provided a brief outline on the history of the world’s reserve currencies, noting that the dollar’s run had lasted 100 years at the start of 2020. According to the strategist, other major global fiat currencies like the euro or China’s yuan have failed to gain the world’s trust, underlining the lack of a successor for the dollar.
Sharma said that a new class of decentralized contenders — cryptocurrencies like Bitcoin — are likely to threaten the dollar’s supremacy. Bitcoin has already established itself as one of the hottest investments of 2020 by quadrupling in price since March amid the pandemic and the U.S. Federal Reserve’s continued money printing, he noted:
The strategist warned central banks to pay more attention to their monetary policies if they want to maintain their position of power: “Bitcoin’s surge may still prove to be a bubble, but even if it pops, this year’s rush to cryptocurrencies should serve as a warning to government money printers everywhere, particularly in the U.S. Do not assume that your traditional currencies are the only stores of value, or mediums of exchange, that people will ever trust.”