• Michael Bacina

Deustche Bank: Digital Currencies may dominate by 2030


Many in the Blockchain and digital currency world predict that fiat currencies will be replaced by cryptocurrencies and digital currencies, in a surprising move Deustche Bank has released it's Konzept prediction report for 2030, making this very prediction.


The report acknowledges that plenty of "10 year prediction" reports are wrong in many ways before raising concerns about the stability of fiat currency:

The forces that have held the current fiat system together now look fragile and they could unravel in the 2020s. If so, that will start to lead to a backlash against fiat money and demand for alternative currencies, such as gold or crypto could soar.

The report argues that the inflation which has historically accompanied unbacked fiat currency has been impacted by a "once in a lifetime event" of Chinese labour becoming available to the global market:

Chinese demographics were arguably the biggest suppressors of global inflation over the last four decades. At work was an extraordinary surge in the global labour supply at a time when globalisation and deregulation in the global economy were taking off.

As China's demographics turn away from this inflation-suppressing impact, the author suggests that inflation may return and with it a significant threat to fiat currencies. Couple with this is the suggestion that regulatory hurdles for digital currencies are the primary barrier to adoption, together with the need to bring stability to pricing of digital assets (i.e. stablecoins),


The changing position of China in particular in seeking to move to a central-bank digital currency (CBDC) is seen as significant driver towards other countries following suit and moving to digital currencies. Deutsch bank research supports consumer demand for digital payments:

According to [Deustch Bank] primary research, nearly two thirds of consumers prefer dematerialised to cash payments and a third are concerned by anonymity. These are the two things that cryptocurrencies do best.

No prediction would be complete without raising electricity concerns, and the report sensibly focuses not on environmental concerns (the myths of which still proliferate) but rather on the need for electricity to underpin near all payments in an economy in a time of increasing cyber attacks.


This report also focuses heavily on stablecoins and CBDC as the cornerstone of digital currency to replace fiat, and doesn't opine on whether and how peer to peer systems might still compete with centralised systems for a CBDC.


It's impressive to see such a major international bank put such bold predictions around digital asset adoption, which shows clear thought leadership which other banks will be sure to follow.