Bitcoin’s threat to the global financial system is probably at an end

2020 could well be the year that the cryptocurrency dream dies. This is not to say that cryptocurrencies will die altogether – far from it. But to all the financial romantics who have cheered the rise of bitcoin and other digital currencies over the past decade, there is a reckoning coming. Like it or not, the vision of a world in which these currencies liberate money from the clutches of central banks and other corporate giants is fading rapidly.

It is not that these currencies have no place in the future of money. The encrypted blockchain technology that underpins them is extremely difficult for governments to control, so it is unlikely that they will ever be eliminated. In any case, they have a valid role to play as a geopolitical hedge – witness the surge in bitcoin and cryptocurrencies after the latest escalation in tensions between the US and Iran, for instance.

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