According to analysts at Morgan Stanley, there is a belief that both Bitcoin (BTC) and Central Bank Digital Currencies (CBDCs) have the potential to pose challenges to the dominance of the U.S. dollar.
In a recent report from Morgan Stanley, it is suggested that BTC could emerge as a leading global currency, potentially surpassing the U.S. dollar, which presently constitutes approximately 60% of international foreign exchange reserves.
Andrew Peel, the head of digital assets at Morgan Stanley, highlights that this shift is notably expedited by the Securities and Exchange Commission (SEC) approving a series of spot Bitcoin Exchange-Traded Funds (ETFs) in the United States. The approval has led to weekly inflows into these new products exceeding $1.18 billion. Additionally, BTC has demonstrated consistent growth over the last 15 years, with the current global ownership of the cryptocurrency reaching 106 million people. Peel also mentions the widespread presence of Bitcoin ATMs in over 80 countries.
Morgan Stanley’s report underscores the potential of CBDCs to establish a standardized framework for cross-border payments. This development could reduce dependence on traditional intermediaries like SWIFT and lessen reliance on dominant currencies such as the U.S. dollar.
It is noted that CBDCs from various countries could impact the supremacy of the U.S. dollar, enabling swift cross-border transactions without the necessity of a common currency like the U.S. dollar.
Presently, Block Research indicates that Bitcoin’s market share is nearly 49%. In November 2023, Bitcoin held over 51.4% of the cryptocurrency market, marking one of the highest figures in recent years. The expanding dominance of Bitcoin underscores its pivotal role in the cryptocurrency market, influencing altcoins and shaping overall market sentiment.