Fiat money has its own protocols that stabilise inflation using interest rates and bond-buying, and the money supply that results from this is generally ignored. With cryptocurrencies however, money supply does not respond to shifts in money demand and with a relatively fixed supply, large fluctuations in value and prices result (in the preceding 11 months the price of bitcoin has soared almost 8 fold5). This some argue, is specifically the reason Bitcoin and other cryptocurrencies will not take over2 and makes Bitcoin impractical as a money. Cryptocurrencies however have proven to be a useful alternative to traditional reserve currencies in places with poor monetary policy and weak banks. In Kenya for example, 1 in 3 people own a bitcoin wallet1, while in India, where recently there has been a significant shortage in cash supply, greater numbers of people have converted to the use of bitcoin.If a particular country were to adopt Bitcoin to replace its currency, the effects of doing so would likely be felt by others in a knock-on effect. A larger credit cycle in one country would mean larger booms and busts for its trading partners. Foreigners outside the country that adopted the cryptocurrency, may also opt to deposit directly within that country and desert their own country’s banks in doing so – this could affect the flow of capital into and out of a their home country, further amplifying the credit cycle. The latest difficulties with Bitcoin make the prospect of a crypto currency takeover seem fanciful at the moment, but if solutions to these problems were found or a new currency were devised with better protocols, central banks would have to resolve these dilemmas one way or another.