One critique of cryptocurrencies is that they are solutions looking for a problem. Many people find that fiat currency and existing technology like credit and debit cards work fine, and they’re more scalable and user-friendly than crypto. So why do we need crypto at all?





Opinion polling provides one potential answer: At least in the US, people are losing confidence in the institutions most closely associated with fiat currency.





Prior to the 2008 financial crisis, more than 50% of Americans had “quite a lot” of confidence in banks, according to Gallup polling. Now, that number is more like 30%. Ask about confidence in the people running the banks, as a National Opinion Research Center poll did, and the number of people with “a great deal” of confidence has dropped from over 30% pre-crash to around 10% today.





















This is happening even though in the past 20 years, particularly in the US, it has become progressively easier and more efficient to organize your fiat money. Even as ATMs proliferated and online services made banking far more convenient, confidence in banks failed to rise.





It’s also worth noting that this data reflects the opinions of Americans, whose fiat currency and central bank are stable, mostly predictable and globally pre-eminent. Even after the crash, Americans have perhaps the most developed financial infrastructure in the world, where bank accounts are guaranteed by the state, and hyperinflation is a distant risk.





This is a stark contrast to citizens of Venezuela or Argentina. In those economies, the fiat system is in tatters. Hyperinflation is rife and bank accounts are insecure. If even Americans are starting to lose confidence in their fiat system, it is not hard to imagine how little trust remains in less stable economies. Large numbers of Argentinians, for instance, now prefer to solely carry cash rather than put their money in a bank. And some Venezuelans have embraced cryptocurrency as an alternative to dealing with their country’s fiat currency woes.





Yet in the US as well, trust in the centralized institutions that collectively manage and organize fiat appear to be on the downswing, although it is not as low as would be required to drive widespread crypto adoption. But if trust ever does sink that low, cryptocurrency presents a rather elegant solution, since cryptocurrencies are supposed to remove centralized institutions altogether.





Matt Bartlett is a New Zealand-based writer.



