pam on Nostr: With 159 countries racing to join BRICS, the possibility of de-dollarisation is ...
With 159 countries racing to join BRICS, the possibility of de-dollarisation is becoming more real everyday. Whether we like it or not, this shift can trigger currency war. This is where Bitcoin can and will serve as the mediator, the peacekeeper - but in order for that to happen, it needs to be easy and seamless, in converting from any currency to bitcoin to encourage global trade (real trade - import, export and transactions between customers and local businesses).
quoting note1w7c…hv78I think one of the most important use cases needed to improve and accelerate Bitcoin adoption is its flexibility in quick multi-currency transactions.
If we look at it from 2 perspective :
1. De-dollarisation and Geopolitical Shifts
Saudi refusing to renew the 1974 petrodollar deal in recent weeks, and further strengthening its partnership with BRICS is a symbolic movement towards de-dollarisation.
The weakening of the US currency will reduce global trade dependency, undermine sanctions, expose vulnerabilities, and amplify FOMO towards BRICS (many countries are already quietly and rapidly joining this bloc). This can create global currency war.
Bitcoin could serve as a "peacekeeper" by being a neutral medium that reduces dependency on politically influenced currencies. But more importantly, with the ease of currency exchanges, countries globally will no longer need to depend on USD or BRICS. Any two countries can interact with each other using Bitcoin or their own currencies via Bitcoin seamlessly.
2. On small business payments for global trade
Small businesses often represent 80% - 90% of a country's business but struggle in competition with hegemony trades that have advanced payment systems, manufacturing and logistics. Current payment gateways often lack the ability to handle small business needs effectively, and manual wire transfers are cumbersome and expensive. Overcoming currency exchanges would improve Bitcoin’s ease of transfer and simplify cross-border transactions, making it an attractive option for SMEs.
Both these scenarios got me thinking of how Bitcoin can come into play, for quick multi-currency transactions.
There are possible options out there for now :
1. Collaboration with stable coins - Pros is stability in value and ease of integration with existing financial systems. Cons is that it is tied to specific currencies, corporate control, and potential centralization issues.
2. Token-based Solutions
With tokens like Cashu, pros is that it is programmable to represent different currencies in real-time. Cons is that it lacks risk assessment, real-world usage, and challenges with ownership concentration.
With tokens like the sidechain that Fiatjaf once shared, the pros is that it can enhance the scalability and functionality of Bitcoin without altering the main chain. But the cons is that there is potential centralization if tokens are controlled by individuals or specific entities.
3. Web5 financial layer - I’m not sure how the financial layer works, but I recall Jack mentioning Block and TBD will be releasing more info soon. The potential lies in integrating decentralized identity and financial systems more seamlessly.
4. Nostr zaps - any global trade or B2B focused client (or other stuff) can be created. Pros is that it could enable flexible currency display, conversion, and quick calculations for businesses. Cons is that it is still figuring out user adoption use cases and challenges. Also limitation of amount spent?
5. Wallets with multi-currency features for KYC and non-KYC - i reckon this follows many pros and cons of the above.
I don’t know if the above list is accurate / inaccurate but all innovations have pros and cons and specific use cases. Continuous feedback from users in different use cases will help improve these technologies. But we definitely do need more innovations and brainstorming in this area.
If the adoption of Bitcoin increases among businesses and individuals, then it will further drive innovation and refinement of Bitcoin's role in global finance.