US-based credit card debt has passed the $1 trillion mark, eclipsing the combined value of crypto assets.
According to the US Federal Reserve, in November of last year combined US credit card debt reached a new high of $1.023 trillion. This is up from a previous high of $1.021 trillion reached in in April of 2008, which was immediately before the market bubbles burst that year, kicking off the Great Recession. Meanwhile, the combined cryptocurrency market capitalization ranks in at $750 billion, under three quarters of that number. This means that if every cryptocurrency in existence was forcibly redistributed to every American according to their credit card debt, that would still not be enough to pay off all that debt.
Global debt grows as digital assets push alternative
While significant, the credit card debt in the United States is trivial when compared across markets on the global scale. According to the Institute of International Finance, global debt reached $233 trillion, an all-time high, eclipsing cryptocurrency’s value many hundreds of times over:
Global debt hit an all-time high of $233 trillion according to the Institute of International Finance (IIF) 😱😱😱
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While many pundits have stated that cryptocurrency is in a bubble, it is still dwarfed by the magnitude of the global debt. Assuming market dominance percentages and coin supplies remain unchanged, in order to equal the world’s debt, the price of a single Bitcoin would have to reach over $4.7 million, and a single Dash would near $350,000.
Dash aims to deliver wealth-based, not debt-based, payments
Credit cards have long served as a dominant global payment system, facilitating easy and relatively cheap and fast consumer transactions. Dash aims to revolutionize the payments industry by providing extremely cheap and instant transactions that are permanently settled instantly, compared to credit cards which can include risk of charge backs. However, even more significantly, Dash aims to build this payments system based on sound money. This is achieved by cryptographically provable transactions and balances, a fixed and immutable supply, and a diminishing rate of inflation. Additionally, the masternode system (and trusted shares offered by several third-party providers) incentivizes saving by paying holders to maintain collateral unmoved, and later stages of the upcoming Evolution release will include protocol-level savings accounts with similar functionality at a much smaller scale. This system creates a global economy centered on the long-term creation of value and capital, rather than an ever-increasing global debt.