Further, as US tech giants such as PayPal under its peer-to-peer Venmo business and Square enable bitcoin transactions, it was arguably moving closer to fulfilling one of the key roles of money in exchanging labour for future purchasing power in a single unit of account.
Bitcoin’s supporters argue its clearer role in the future of money means the price – which topped $US50,400 on Monday – is less relevant to its emerging use cases over the medium term.
FX under attack
Citi also made headlines by claiming bitcoin could uproot the US dollar as the primary means of payment between global importers and exporters: “A focus on global reach and neutrality could see bitcoin become an international trade currency,” Citi says.
“This would take advantage of bitcoin’s decentralised and borderless design, its lack of foreign exchange exposure, its speed and cost advantage in moving money, the security of its payments, and its traceability.”
If Citi is right about bitcoin’s ascent it may flatten banks’ lucrative foreign exchange fees and could do even more damage to pure-play discount rivals or middlemen such as Western Union, OFX Group, Transferwise and Travelex.
Blue-chip tech giant Facebook has already cottoned on to the possibility of creating its own blockchain-based digital currency named Diem as an exchange mechanism to eliminate overseas transfer fees and the spreads charged on currency exchanges to send money internationally.
In theory, a person in the US could transmit savings to Asia if the sender and