If crypto ever replaced FIAT (without ceding some form of input on supply to monetary policy agencies) the instruments used to keep recessions from wiping out the economies of entire nations will be gone. So will the instruments that countries going through what Japan is going through now (fully industrialised country going through a population collapse) needs to keep their economy going. In favour of a crypto future, I can see a scenario where crypto was plugged into credit markets, stock exchanges, employment data and a host of other econometric data. Then it might work . However, we (economists) don’t know enough yet to make a magic algorithm. We will need maybe another century of data with various policy option being followed before this can be attempted. Plus, it leaves little space to innovate. Such a crypto will then have to be country or region differentiated, and demand that a regional/country/state/nation-state government obeys by the recommendations of the algorithm of the crypto. This will be needed to help struggling regions become more competitive and recover from recessions. The crypto will then determine and create government bonds too. Governments will only be able to spend what the crypto states. Governments will probably try to game the system. The same with certain investors. So basically, the entire economy will need to be run by an algorithm?
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