{"id":2252,"date":"2024-08-08T17:09:16","date_gmt":"2024-08-08T17:09:16","guid":{"rendered":"https:\/\/trusteconomics.eu\/?p=2252"},"modified":"2024-08-08T17:09:16","modified_gmt":"2024-08-08T17:09:16","slug":"us-vs-china-bitcoin-will-become-the-new-global-reserve-currency","status":"publish","type":"post","link":"https:\/\/trusteconomics.eu\/index.php\/2024\/08\/08\/us-vs-china-bitcoin-will-become-the-new-global-reserve-currency\/","title":{"rendered":"US vs. China: Bitcoin will become the new global reserve currency"},"content":{"rendered":"\r\n<p>In an era characterized by global economic instability and high political uncertainty, the idea of \u200b\u200ba new world order in the financial sector is gaining more and more ground. Now, there are questions about how this new world order will take shape.<\/p>\r\n\r\n\r\n\r\n<p>The dollar has long held this position, but its reign is increasingly being challenged by rising debt levels, rising income inequality, political polarization and, above all, recent geopolitical developments.<\/p>\r\n\r\n\r\n\r\n<p>Since the US began weaponizing the dollar, with the seizure of dollar reserves by Afghanistan&#8217;s central bank after the Taliban&#8217;s re-emergence in power, or by cutting Russia off the SWIFT payment system after the invasion of Ukraine, sovereign countries they started looking for alternatives (please read the analysis titled &#8220;<a href=\"https:\/\/liberalglobe.com\/?p=19665\">BRICS: The new global financial order will be achieved by removing sanctions, using cryptos, gold and de-dollarization<\/a>&#8220;).<\/p>\r\n\r\n\r\n\r\n<p><strong>From the Empire to the multi-political world<\/strong><\/p>\r\n\r\n\r\n\r\n<p>For example, the BRICS countries are currently pursuing a strategy of de-dollarization, advocating a new common currency for trade and investment among themselves, and have already begun to boost trade in national currencies instead of the US dollar.<\/p>\r\n\r\n\r\n\r\n<p>Today, one possible outcome could be a multipolar world order with a decentralized reserve currency rather than a sovereign one, namely Bitcoin.<\/p>\r\n\r\n\r\n\r\n<p>At a recent Bitcoin conference in Nashville, former US President Donald Trump promised to maintain a &#8220;strategic national bitcoin reserve&#8221; and supported US Bitcoin mining, also noting with particular emphasis his policy that &#8220;if we don&#8217;t , China will and we will lose the coming currency war.&#8221;<\/p>\r\n\r\n\r\n\r\n<p><strong>The big turn<\/strong><\/p>\r\n\r\n\r\n\r\n<p>Senator Melker opened the discussion by noting the recent news that former President Donald Trump hinted at a strategic bitcoin reserve in a speech in Nashville. Shortly thereafter, Senator Cynthia Lummis introduced the \u201cBitcoin Bill\u201d &#8211; Enhancing Innovation, Technology and Competitiveness through Streamlined Investment at the Nationwide Level. This bill is going to position the United States as a leading force in bitcoin adoption.<\/p>\r\n\r\n\r\n\r\n<p><strong>The geopolitical role and strategic advantage<\/strong><\/p>\r\n\r\n\r\n\r\n<p>This bill represents a critical first step toward bitcoin adoption and use, potentially giving the US a strategic advantage over geopolitical adversaries.<\/p>\r\n\r\n\r\n\r\n<p>The five main elements of the bill are:<\/p>\r\n\r\n\r\n\r\n<ul class=\"wp-block-list\">\r\n<li>Creation of foreign exchange reserves through the Ministry of Finance,<\/li>\r\n\r\n\r\n\r\n<li>bitcoin shopping program,<\/li>\r\n\r\n\r\n\r\n<li>recording stocks based on transparency rules,<\/li>\r\n\r\n\r\n\r\n<li>halting the auction of 210,000 bitcoins and<\/li>\r\n\r\n\r\n\r\n<li>an option for third states to become involved.<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n<p>Importantly, the bill proposes to finance these purchases without increasing the national debt, a creative solution worked out by Lummis&#8217; team.<\/p>\r\n\r\n\r\n\r\n<p>Melker pointed out that the bill proposes to buy 200,000 bitcoins per year over five years, for a total of about one million bitcoins, about 5% of the existing supply.<\/p>\r\n\r\n\r\n\r\n<p>This is a logical step, given the possibility of using bitcoin as a powerful monetary tool. It is of great importance that the USA does not lose this opportunity to countries like Russia or China. The discussion also touched on the geopolitical ramifications.<\/p>\r\n\r\n\r\n\r\n<p>Melker noted that the US&#8217;s public discussion of such a strategy may prompt other central banks and governments to consider similar policies.<\/p>\r\n\r\n\r\n\r\n<p>The status of these US legislative efforts and these policy decisions are made by politicians like Trump and RFK, who support bitcoin.<\/p>\r\n\r\n\r\n\r\n<p>Market dynamics for Bitcoin still see more sellers than buyers at current prices, a situation that is believed to be changing after the November election.<\/p>\r\n\r\n\r\n\r\n<p>The bipartisan nature of support for bitcoin, noting that Democrats like Rep. Ro Khanna have been longtime supporters of the cryptocurrency.<\/p>\r\n\r\n\r\n\r\n<p>The US is not the only country considering this move as many other countries have already implemented these policies, most notably the first &#8211; but not the only and not the last &#8211; El Salvador already adopted Bitcoin as a currency and added it as part of its monetary reserves.<\/p>\r\n\r\n\r\n<div class=\"wp-block-image\">\r\n<figure class=\"aligncenter size-large\"><img decoding=\"async\" class=\"wp-image-19673\" src=\"https:\/\/www.liberalglobe.com\/wp-content\/uploads\/2024\/08\/image-24-1024x321.png\" alt=\"\" \/><\/figure>\r\n<\/div>\r\n\r\n\r\n<p>&nbsp;<\/p>\r\n\r\n\r\n\r\n<p><strong>The next global currency and its benefits<\/strong><\/p>\r\n\r\n\r\n\r\n<p>One of the main advantages of Bitcoin as a reserve currency is:<\/p>\r\n\r\n\r\n\r\n<p><strong>1.<\/strong> <strong>His steady supply<\/strong><\/p>\r\n\r\n\r\n\r\n<p>With a fixed supply cap of 21 million coins, Bitcoin&#8217;s value is not subject to inflationary pressures, which can erode the purchasing power of traditional currencies. This inherent stability of its value is attractive to nations seeking a reliable reserve currency and medium of exchange.<\/p>\r\n\r\n\r\n\r\n<p><strong>2.<\/strong> <strong>The decentralized nature of Bitcoin<\/strong><\/p>\r\n\r\n\r\n\r\n<p>Its decentralized nature also eliminates the need for intermediaries such as central banks or governments, making it less susceptible to political manipulation as the US&#8217;s use of sanctions conveyed a global lack of confidence in the US currency.<\/p>\r\n\r\n\r\n\r\n<p>As more countries recognize the benefits of adopting Bitcoin as a sovereign reserve currency, a new world order is beginning to take shape that represents a seismic shift in monetary history.<\/p>\r\n\r\n\r\n\r\n<p>Through the increased adoption of Bitcoin as a reserve currency, we can only expect to see profound transformations in the way states interact economically and politically.<\/p>\r\n\r\n\r\n\r\n<p>While the dollar is the de facto reserve currency of the post-Bretton Woods world in a unipolar world, Bitcoin may take its place in an increasingly com<\/p>\r\n","protected":false},"excerpt":{"rendered":"<p>In an era characterized by global economic instability and high political uncertainty, the idea of \u200b\u200ba new world order in the financial sector is gaining more and more ground. Now, there are questions about how this new world order will take shape. The dollar has long held this position, but its reign is increasingly being &hellip; <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19],"tags":[476,774,52,621,775,141],"class_list":["post-2252","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bitcoin","tag-bitcoin-bill","tag-china","tag-currency-war","tag-reserve-currency","tag-usa"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/posts\/2252","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/comments?post=2252"}],"version-history":[{"count":2,"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/posts\/2252\/revisions"}],"predecessor-version":[{"id":2258,"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/posts\/2252\/revisions\/2258"}],"wp:attachment":[{"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/media?parent=2252"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/categories?post=2252"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/trusteconomics.eu\/index.php\/wp-json\/wp\/v2\/tags?post=2252"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}