Most of us in the crypto community foresee a future in which the world will predominantly use digital peer-to-peer currency. However, this is a dream that will never come to pass according to Scott Gallit. Gallit, the CEO of digital payment services company Payoneer, believes that noble as the idea is, the powers that be would never let it come to pass. And don’t let recent attempts by some governments fool you, he stated referring to Ohio’s crypto tax payments.
Indeed, the journey to a unified currency is uphill. For one, even the crypto community currently is unable to settle on what the best currency for this venture would be. Bitcoin has the upper hand as it has a 54 percent dominance. However, some altcoins offer enhanced features such as XRP’s speed, Monero’s privacy and EOS’ scalability.
One digital currency to rule the world is a noble idea. It would get rid of many problems including value manipulation, foreign exchange fees and more. However, the probability of this happening is next to nil according to the Payoneer executive. Payoneer is a New York-based fintech startup that processes payments for major companies including Google, Upwork, Amazon and Airbnb. It’s valued at $1 billion, making it one of the many fintech unicorns.
Speaking to CNBC’s Make It, he stated:
Despite the interests of lots of people out there in the Internet world who love the idea of frictionless commerce and frictionless money and avoiding fiat currencies, I don’t see it
Gallit laid out two fundamental reasons why a global digital currency would never work. The first is taxes, he explained.
And so, if there’s a single global currency, how do you get from here to there in a way that actually enables that government, in whatever country that is, to really tax and collect revenues. Now you can have a debate on whether taxes are fair or unfair, but they are a reality. There are going to be taxes because governments need revenues. Countries actually need tax revenue in order to fund services for their residents.
The second barrier is the central banks. These institutions are put in place to regulate the economy, and managing the currency plays a very big part. Once a central bank loses its hold over the currency, it loses its most effective monetary policy tool. These banks are therefore never going to let the dream of a single global currency become a reality.
Come Down From Utopia
Gallit acknowledged that the dream has its merits. However, most of us approach the challenge from a utopian point of view. We want to give everyone equal opportunity regardless of where they come from and let them become masters of their own fates. However, we must come down from utopia into the real world for us to come up with a tangible solution, he stated.
But practically, there are going to be limitations and constraints that are going to be very hard for folks to overcome. And so as Payoneer, we work within that as opposed to moving outside that