With tensions rising between the BRICS alliance (Brazil, Russia, India, China, and South Africa) and the United States, the future of the US dollar’s global reserve currency status hangs in the balance. While the BRICS nations have been actively seeking ways to reduce reliance on the dollar in international trade, economist Jeremy Siegel argues that a more significant threat may be emerging: Bitcoin.
BRICS and De-dollarization
Since 2022’s Ukraine invasion, the BRICS bloc has openly pursued alternatives to the US dollar. This push for “de-dollarization” stems from a desire to lessen dependence on Western financial systems, particularly in light of sanctions imposed on Russia.
However, the BRICS’ efforts have been met with strong opposition from the US, with the potential return of a protectionist trade policy under a hypothetical new administration. This adds a layer of complexity to the de-dollarization debate.
Bitcoin: A Competing Reserve Currency?
Siegel, a senior economist at WisdomTree, believes Bitcoin poses a greater threat to the US dollar than any BRICS-led initiative. Unlike a state-backed currency, Bitcoin is decentralized and operates outside traditional financial structures. This makes it an attractive alternative for nations seeking to diversify their reserves.
Trump’s Stance on Bitcoin: A Point of Curiosity
Siegel finds it contradictory that a hypothetical new administration would simultaneously oppose BRICS’ de-dollarization efforts while seemingly celebrating Bitcoin’s recent price surge. This perceived inconsistency raises questions about the potential long-term impact of Bitcoin on the global financial landscape.
Bitcoin’s Rise and the Dollar’s Future
Bitcoin’s recent price explosion, coupled with projections of further growth, strengthens Siegel’s argument. If Bitcoin continues its upward trajectory, particularly with support from a hypothetical pro-crypto administration, it could incentivize more countries to move away from the US dollar reserve system.
Also Read: BRICS vs. US: The Race for Bitcoin Supremacy in 2025 and What It Means for the Crypto World
The future of the US dollar’s dominance remains uncertain. While the BRICS nations actively push for de-dollarization, the rise of Bitcoin as a potential global reserve currency presents a potentially more significant challenge. The coming years will likely see a tug-of-war between traditional financial systems and emerging cryptocurrencies, ultimately shaping the global economic landscape.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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