Most of Europe and Japan are already in a negative interest rate regime, with the US and UK very likely to follow suit in the coming months. Consumers have so far been spared the direct sting of negative interest rate as banks have tried to absorb some of the cost by increasing fees on some services, but as the RBS has already demonstrated today, this will not be the case for much longer:
Until now RBS has absorbed these costs and imposed a zero per cent minimum on deposit rates. But it said this was no longer sustainable.
It is precisely at this point that digital assets and currencies like Bitcoin will begin to gain serious traction with small businesses and consumers. Bitcoin has a fixed supply and cant be inflated away at the stroke of a pen. The coming global negative interest rate environment bodes very well for the future of Bitcoin and digital assets outside the legacy financial system.
Firstly, I would like to express my complete agreeing with the quoted text. Now, to continue the story, in order to successfully impose the negative interest rate on personal deposits, they need to take the bulk of paper cash out of the circulation. Which Kenneth Rogoff (the "This time it's different" author) has now publicly voiced.
http://www.wsj.com/articles/the-sinister-side-of-cash-1472137692Now, the article does say that private hoarders hinder the imposing of negative interest rate on deposits. Which is true. But there is one bigger reason for central banks to withdraw cash: the banks themselves tend to build vaults to store cash, so they don't have to pay money to central banks to store money for them.
http://www.bloomberg.com/news/articles/2016-03-16/munich-re-rebels-against-ecb-with-plan-to-store-cash-in-vaultshttp://www.ft.com/cms/s/0/e979d096-5fe3-11e6-b38c-7b39cbb1138a.html#axzz4IdhNlZiwThis will for sure make imposing negative rates much more difficult, so I expect central banks to actually go and withdraw large banknotes out of circulation and at the same time extesively diminish the amount of cash available.
This scenario unraveling would mean an insane boost for Bitcoin price. An insane boost. Just saying.