In an interesting conversation regarding the impact of Coronavirus and printing of the money by the Federal Reserve on the global economy, the chief executive officer of the Real Vision, Raoul Pal, touched upon a number of aspects including Gold, Bitcoin, Tokenization, and financial freedom among others. According to Pal, the situation the world is in today where we are battling the contagious effect of Coronavirus and its subsequent impact on the economies can prove to be a silver lining for the cryptocurrency and blockchain technology.
In order to wrest the downward spiral of the economic activities, countries across the world are pushing the money into the system by offering lower interest rates and printing more money. Recently we have witnessed the historic decision by US Federal Reserve of cutting the interest rate by 50 basis points (0.5 percent) and the decision is considered a historical one. In addition to the rates cut, printing more of the fiat currency is also on the cards, but at the same time, all these steps have the potential to push the value of the currency down.
More supply will ultimately devalue the currency and in order to steer clear of such a situation, the system could possibly take the help of the two important assets available in the present context. One of these primary assets is the gold, while cryptocurrencies could possibly take the form of the second asset in order to pull the world economy out of the possible recession.
Decentralization: A way forward
Citing the example of building a decentralized database, Pal emphasized that decentralization is a way forward if economies have to become more efficient while providing equal opportunity to all the players to compete in the industries. Pal drove home the point that digitization is not only about the Bitcoin and other cryptocurrencies as a whole lot of stuff is going on to make things decentralized, more accessible, and more effective to operate.
During the discussions, the issue of having exposure to the cryptocurrencies also came up, and Pal emphasized that it is important to have an investment in cryptocurrencies according to the cycle of age you are in. One has to profile the risk aspect of the cryptocurrencies and then accordingly invest in the Bitcoin and other digital coins.
Tokenization: Powering the Next Phase of Crypto Growth
The concept of tokenization also figured in the discussions and its potential to power the next wave of growth in the Crypto industry has been recognized well by the CEO of the Real Vision. If the whole process of tokenization is studied and researched carefully with a great deal of emphasis placed on examining the important aspects of the company, its business model, and stream of revenue, then the phenomenon of tokenization can lead you to the greater financial success in the life. Towards the end of the interview, Pal explains his dilemma of understanding the Bitcoin when the fork happened, although he still has a great degree of faith in Bitcoin and supports it as a means of financial access and freedom for all.