Imminent Central Bank Bankruptcy Could Bring Bitcoin Adoption Sooner as per Peter Thiel

The central bank plays a key role in every economy; managing the national currency. It controls the currency flow by either injecting or withdrawing funds from the economy. All of the money in circulation is printed by the central banks. Yet, there is talk that the bankruptcy of central banks is possibly going to happen. Peter Thiel, a renowned investor who is the founder and chairman of Palantir Technologies inc, sees it happening sooner than later. And that will most probably bring the adoption of Bitcoin sooner than expected. So just how can a central bank go bankrupt? Read on to find out. Brief on How the Central Bank Works Before printing any currency, the central bank must have a set intended target cause of action within the economy. The most common aim is usually to either reduce or induce inflation. Another important aim is usually to devalue the currency, maintain its current valuation or increase its value. There are two key options to affect the two primary variables: raising and lowering interest rates. Such a step reduces or increases the money supply respectively by affecting the cost of borrowing. The second option is quantitative easing. It involves directly injecting money into the economy through the purchase of bank securities. This money is made simply. The reverse consists in selling government securities to the banks to reduce the money supply. Where the Problem Begins The problem now arises from such ex...