Investor veteran, Robert Kiyosaki recently shared his prediction that cryptocurrencies have the potential to rise when the dollar falls.
In an article on RichDad.com, Kiyosaki stated that when the US dollar loses its dominant position, cryptocurrencies could become an attractive alternative for international trade and cross-border transactions.
“We have witnessed increasing concerns about the stability and future of the US dollar, and some experts predict the potential for global dedollarization,” said the author of the book ‘Rich Dad Poor Dad’.
He said that global dedollarization would have consequential impacts on Americans.
Some of the implications of what could happen if the US dollar is no longer the main global currency include: Higher Import Prices, Limited Access to International Markets, Volatility in Foreign Exchange Markets, Impact on US Businesses, Increase in Interest Rates, and a Rise in National Debt.
“If the dollar is not as strong as before or is unable to buy as much as before, Americans will face significant difficulties in their lifestyles. Inflation can worsen. Investment opportunities can be missed. Savings can shrink,” he added.
Crypto as a Potential Solution
According to Kiyosaki, in the above scenario, cryptocurrencies emerge as a potential solution.
Whereas cryptocurrencies, which are different from fiat currencies, operate on a decentralized ledger called the blockchain, offering transparent, secure, and manipulation-resistant transactions.
“In the case of the US banking system, the dollar, or more precisely, the value of the dollar, is directly tied to the volatile market, interest rates, and government policies. Cryptocurrency values, on the other hand, are determined by market demand.”
According to Kiyosaki, cryptocurrencies offer a stable and reliable alternative to the dollar, and their increasing popularity and acceptance could make them an integral part of the global economy.
“Imagine what could happen if the US dollar weakens as the main global currency. The US dollar may not have strong purchasing power if that happens, but cryptocurrencies like Bitcoin could become a preferred and stronger method of financial transactions for countries to do business,” he said.
He acknowledged that there are also risks associated with cryptocurrencies.
“They have not yet been fully accepted as a form of payment, and their value can be highly volatile. This makes it a risky investment for those who are not familiar with this technology,” he said while emphasizing the importance of education when discussing crypto investments.
“The debate about the role of cryptocurrencies in the global economy continues, and the potential for significant changes in the global financial landscape remains an interesting topic to follow,” concluded Kiyosaki. [ab]
