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14 sats \ 3 replies \ @spiderman OP 1 Sep \ parent \ on: Will Other Countries Be Okay with Bailing Out or Helping Britain and France? econ
Emarat, the largest gas station operator in the Emirates, will fill up your car tank for your...Satoshis.
Has there ever been a larger challenger to the petrodollar status quo? I do not believe Saudis will fall in the trap of one fiat jumping from another. Why would a digital yuan (or whatever fancy shit the CCP comes up with) be any better than Tether or some US treasury bills?
The Saudis have already joined Chinas mBridge protocol and are reportedly already making sales via non USD protocols.
It would make good sense for many of the Muslim nations to adopt Bitcoin as it is free of debt and conforms very well the Islamic principles but China is the largest market now for their exports and UAE was a founding member of the mBridge protocol development group which also included Thailand and Hong Kong.
Perhaps the UAE are allowing sats internally but adopting Chinese protocol/s for international trade payments?
Would love to fill my van up with gas paying in sats!
Hope it can one day happen here in New Zealand and great to hear it is already possible in the UAE. Good on them.
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Why would a digital yuan (or whatever fancy shit the CCP comes up with) be any better than Tether or some US treasury bills?
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USD dominance derives from US dominance in global trade and finance post WW2 when the other major power manufacturing and economies were decimated.
Today China dominates in global trade in manufactured goods and commodities- it therefore makes perfect sense for China to implement protocols which are native to its financial system rather than continuing to be forced to process trade payments with other nations via the USD and US financial institutions.
This building of its own 'in house' protocols has been Chinas openly stated and quite understandable objective for many years and it is now being implemented.
They may not yet be seeking to replace USTs or act as a SoV currency but in terms of trade payments they have an arguably legitimate right to build and introduce their own trade payments protocols.
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Of course, I am not the one questioning China's right to build their trade settlement platforms. Even at the private side, Visa and Mastercard enjoy a massive duopoly around the world as the only truly global payment processors, and if they have to face some cost competition because of whatever someone else has to offer (whether using Bitcoin, Ethereum or Fiat rails) that is always welcome too.
But sometimes I just wonder why would any country (except the US or China themselves) voluntarily end up beholden to one of their systems (Swift, Dollar settlement or CIPS etc.) when you have a politically neutral rail like the Bitcoin blockchain secured by more computing power than Google, Amazon and Microsoft combined.
Ah yeah, the volatility...and that reassures me I am still early in the Bitcoin (while I bite my finger everyday for not adopting a decade sooner).
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I dont think the volatility is so much the issue as power and control.
The USD/SWIFT system has given the USA both huge power via the ability to sanction countries that do not conform to its expectations and wishes and because SWIFT is USD based SWIFT results in all central banks needing to hold significant quantities of USD in order to participate- thereby USA can print (digitally) almost limitless USD to satify the volume of currency needed to maintain global trade payments which is a large part of the extraordinary privilege that the USA has enjoyed via its global fiat 'petrodollar' hegemony.
This has enabled the USA to live way beyond its means, having trade and fiscal deficits for the last 50 plus years and able to because almost everyone needs USD in order to participate in global trade payments.
China, imo, rightly sees this as unreasonable and now increasingly seeks to organise trade payments denominated in its currency.
Why should China be forced to denominate trade with say Nigeria, (or almost any other country) in USD simpkly because the USA holds a quasi monopoly over trade payments?
When I have traded with China in the past IO had to pay a US bank to convert my NZD to USD in order to pay the Chinese supplier.
Why can I not simply pay the Chinese supplier in Yuan and convert my NZD directly to Yuan without a US bank acting as a compulsory middleman clipping the ticked every time?
This is why China seeks to build its own trade payments protocol/s - so that it can cut out the US banks and remove the risk of sanctions by the US and reduce costs for its merchants and trade partners trading with them.
Ultimately of course if trade is increasingly denominated in Yuan that delivers leverage, wealth and power to China and reduces US leverage, wealth and power.
IMO the competition between the US and China is centred on who controls the global trade payments system and if the USA loses its current dominance over that it loses pretty much all other dominance as its position is so hugely dependent upon the dominance of the USD.
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