Nobody doubts that since the creation of the Federal Reserve Bank the dollars has lost 99 percent of its purchasing power.
Nobody doubts that the dollar's reserve status is under attack from most certainly China and Russia., and from all appearances the rest of the BRICs nations: India and Brazil and South Africa.
Nobody doubts that during the next crisis the dollar is bound to suffer a tremendous loss of value.
Yet, nobody agrees on what will eventually replace the dollar as the world's reserve currency.
There are three options:
A) Another fiat paper currency.
B) An entirely electronic fiat currency.
C) A gold backed currency.
As for the dollar being replaced by another fiat currency, while certainly a possibility, it would necessarily have all the same problems as the dollar, as every country has its own central bank to function as a money printing machine.
The real choice as the global economy moves forwards, is between a gold backed currency and an entirely electronic currency.
The problem with an electronic currency is that whereas it can certainly operate efficiently as a medium of exchange it can never fulfill its function as a store of value.
The reason is twofold. First, like a fiat paper currency it has no intrinsic value.
Second, and even more dangerous, there is no way for a private citizen to own the currency. It exists only as an idea. The private citizen can lease the idea for private use. But the idea can be stolen, confiscated, or reassigned by anyone with access to the language in which the idea is described. In this case a computer language.
If we take Bitcoin as a model, the examples of hacked Bitcoin accounts are legion. There is no way to safeguard against the theft of something that has no corporeal form.
It is no different from simply giving your word you will honor a verbal contract. Without a corporeal written contract there is no way to prove ownership.
It's fun to imagine a future One World Government that puts micro chips in its citizens wrists the monitor every electronic transaction. But the fact is any MIT PHD will still be able hack the system.
This leaves gold backed currency as the only functional option.
There is ample evidence that China and Russia have already accepted this conclusion are working jointly towards this inevitability
A history of bitcoin hacks
The alternative currency has been plagued by hacks, ponzi schemes and increasingly professional thefts since 2011, explains Alex Hern
Cryptographic currency's massive rise in value leads to a corresponding increase in online heists by criminals seeking easy paydays.