Is Bitcoin a Threat to the US Dollar?

Is Bitcoin a Threat to the US Dollar?

Some crypto critics have continually criticized Bitcoin as a market disruptor that would turn the global economy on its head. Although such sentiments can discourage investors from putting money into Bitcoin, its adoption has grown to mythic proportions over recent years. Experts predict that BitiCodes Bitcoin adoption and prices will continue to grow mainly due to its limited supply and increasing market demand. Is Bitcoin a Threat to the US Dollar?

Significant value surges and dips have marked Bitcoin’s performance over recent years. However, it has also outperformed almost all conventional assets, including precious metals, over the same period. Investors believe that trend will continue, sparking fears that Bitcoin could threaten the global reserve currency, the US dollar. The following is an analysis of how Bitcoin relates to the USD. 

Supply and Market Cap 

The US Treasury department regulates the supply and usage of the US dollar. It determines when and how much money to print and distribute in the global economy. Like other fiat currencies, the US government is the sole custodian of the USD, and it can create as many new notes and coins as it wishes. Currently, the USD accounts for so much more transactions than Bitcoin. Even Bitcoin’s market cap is like a drop in the ocean compared to the USD. 

Unlike the US dollar, Bitcoin does not have a central authority to regulate its supply and usage. Instead, Bitcoin’s protocol determines the creation of new tokens. Unlike the USD that the treasury can print at will, the Bitcoin protocol stipulates the rate of generating new tokens. Besides, Bitcoin’s supply can only be more than 21 million digital coins if stakeholders change its protocol. 

Bitcoin generally has more use cases than the USD since it is tech-based. However, Bitcoin’s limited supply makes it difficult to outshine the USD. The US dollar is a mainstream currency and store of value, with a larger market cap than Bitcoin. Even if Bitcoin’s value increases, it would still not overshadow the USD. Bitcoin might threaten Bitcoin if it gains mainstream adoption, but that would take several years. 


The US dollar is recognized and accepted worldwide as the global reserve currency. It is currently the currency of choice for international trade, held extensively by investors worldwide. The USD is a legal tender in several countries and jurisdictions around the globe. Even Bitcoin uses the US dollar as a representation of its value. While crypto exchanges such as allow traders to buy Bitcoin with different fiat currencies and crypto, the US dollar remains the primary currency. 

Bitcoin adoption has increased by huge margins over recent years, surpassing many investors’ expectations. Experts predict a similar trend will continue for many years to come. Thousands of businesses and consumers worldwide currently accept and use Bitcoin in transactions. However, its acceptance still lags behind that of the USD. 

Many merchants and investors still need to be convinced about adopting Bitcoin due to its volatility and growing regulatory pressures. Security and scalability concerns are also why some people still have reservations about Bitcoin. Volatility will only go away when Bitcoin prices stabilize, which would take several years. The future of Bitcoin regulations is still uncertain as regulators remain divided on establishing a uniform framework. Continuous developments can help to address scalability and security issues, but such improvements will take time. 


We can say that Bitcoin is a Threat to the US Dollar. Bitcoin has made significant gains in value and adoption over recent years. Nonetheless, its acceptance, market cap, and usage remain relatively lower than the US dollar. Thus, there is no sufficient evidence that Bitcoin threatens the USD. 

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