Is Elon Musk Right to Say That Governments Can’t Destroy Crypto?

Elon Musk Says Governments Shouldn’t Think About Destroying Cryptocurrencies

Some investors see cryptocurrency as a great opportunity to eliminate economic inequality in society and others see it as a hedge against inflation. Many others just want to cash in on the digital currency while it gives a good return on investment. With the rapid rise of cryptocurrency, the debate over regulating it is also gaining momentum. Authorities around the world are contemplating how to manage the disruption it causes, and yet its market and user base continues to grow. Earlier this week, billionaire entrepreneur Elon Musk, a staunch supporter of these virtual coins, warned governments against trying to “destroy” cryptocurrencies. But he recognized that they could slow its progress.

Cryptocurrencies are basically aimed at curtailing the power of a centralized government, Musk said, which is why “they don’t like it”. The Tesla and SpaceX founder’s statement comes amid crackdown on mining of cryptocurrencies by China, which is blamed for the current electricity shortage in the country. There is also a general consensus that cryptocurrencies have the potential to uplift the existing financial system, but how accurate is Musk’s saying that governments can no longer destroy cryptocurrencies.

Looking at alternatives, some countries – such as El Salvador – have adopted cryptocurrency as a legal tender, while others are considering launching a crypto coin of their own, which may be controlled by national regulators or some can inspect.

On one level he appears to be right. The crypto world is now over a decade old since bitcoin, the first virtual coin, came into existence in 2009. And bitcoin alone has grown rapidly over the years to achieve a market capitalization of $1 trillion. Overall, the market capitalization of the crypto world has crossed $2 trillion. Add to this the growing number of users who have invested real world money in it.

Even as countries like China try to crack down, people are likely to find ways to enter the lucrative but highly volatile market. This is because the entire system is online, i.e. all the transactions and processes work simultaneously over the internet using simple gadgets like mobile phones. It would be a difficult task for any government to completely wipe out the crypto trade.

Musk, one of the sharpest minds in the tech business, probably understands this better than many others and should weigh in on the challenge of banning cryptocurrency.

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