Is the future of money cryptocurrencies?

Supply and demand, we all know how it works. If people want something enough and there isn’t enough of it, the value increases. Suppose there’s no demand or too much of the product, the value decreases.
This is supposed to apply in all aspects of the economy, yet cryptocurrencies seem to break this idea.

Some invest in cryptocurrencies that cite its inability to be traced as a way to move on to the next stage of economics, a new economic system, as it were. One cryptocurrency, in particular, Ethereum, is utilized as a way to purchase NFTs, non-fungible tokens, one-of-a-kind artwork, and other forms of digital media. This means that those who create NFTs have the ability to continually invest in this currency without providing any of their own money.

According to Dr. James Ahiakpor, an economics professor at California State University, East Bay, with a focus on currency, “Cryptocurrency is just another means of payment, like PayPal, a debit card, or a credit card.”

Ethereum allows these artists or creators to become extremely wealthy very quickly. Supporters of cryptocurrencies argue that the ability of anyone with internet access, to become extremely wealthy, nearly overnight, will change the game for many low-income people and nations.

Dogecoin, a cryptocurrency that began as a joke, broke the economic concept of supply and demand in June. The value of this infinite supply cryptocurrency skyrocketed more than 22,000% in less than a year.

There was no change in the supply as it was already infinite, but what changed was the demand, not for any practical reasons; this was based entirely on the word of the CEO of Tesla Motors and SpaceX, Elon Musk.

Ahiakpor continued, “The currency printed by a country’s central bank is that country’s unit of account—measuring the prices of … We don’t measure the value or price of anything in Bitcoin, for example.”
This understanding of currency means that there will have to be governments that shift to cryptocurrencies for this idea of a new economic system to come true. El Salvador has already made part of this shift by allowing Bitcoin to become part of the national tender. Yet, China, leader of the AIIB, a competitor of the World Bank and IMF, has banned the sale and mining of Bitcoin.

Dr. Elizabeth Huffman, a lecturer at Cosumnes River College and expert in International Political Economics, agreed with the sentiment of Ahiakpor, stating, “the inability of a nation to control something like Bitcoin the way they do their own currency, will instigate many nations to not accept cryptocurrencies.”

If one of the larger industrialized economies accepts a cryptocurrency as a tender, this will change the economic system. This would stop the ability of nations to control their own inflation and become dependent on something that has no backing other than confidence.

Currencies are backed by the nations that make them, but if no one wants to buy back cryptocurrencies, their value can plummet, dragging nations down with them.