pahueg on Nostr: ๐ ๐ฎ๐ญ๐ฎ๐ซ๐ ๐ ๐๐จ๐ฉ๐จ๐ฅ๐ข๐ญ๐ข๐๐๐ฅ ...
๐
๐ฎ๐ญ๐ฎ๐ซ๐ ๐ ๐๐จ๐ฉ๐จ๐ฅ๐ข๐ญ๐ข๐๐๐ฅ ๐จ๐ซ๐๐๐ซ ๐๐ง๐ ๐๐ข๐ญ๐๐จ๐ข๐ง
I just finished reading Matthew Pinesโ brilliant paper, โ๐บ๐๐๐๐ก ๐๐๐ค๐๐ ๐๐๐ก๐ค๐๐๐ ๐ถ๐๐๐๐๐ก๐๐ก๐๐๐ & ๐ต๐๐ก๐๐๐๐,โ from the Bitcoin Policy Institute, and oooh boy, itโs amazing.
A few key points really clicked for me; I increasingly believe that the future macro-order will look as follows:
๐๐ง ๐จ๐ง๐ ๐ฌ๐ข๐๐, ๐ฐ๐ ๐ก๐๐ฏ๐ ๐ญ๐ก๐ ๐๐๐ฌ๐ญ (๐๐ก๐ข๐ง๐/๐๐ฎ๐ฌ๐ฌ๐ข๐) ๐๐จ๐ฆ๐ข๐ง๐๐ญ๐ข๐ง๐ ๐ ๐จ๐ฅ๐, ๐๐ง๐๐ซ๐ ๐ฒ, ๐๐จ๐ฆ๐ฆ๐จ๐๐ข๐ญ๐ข๐๐ฌ, ๐๐ง๐ ๐๐๐๐ ๐ง๐๐ญ๐ฐ๐จ๐ซ๐ค๐ฌ. ๐๐ง ๐ญ๐ก๐ ๐จ๐ญ๐ก๐๐ซ, ๐ญ๐ก๐ ๐๐๐ฌ๐ญ (๐๐ ๐๐ง๐ ๐๐ฅ๐ฅ๐ข๐๐ฌ) ๐๐จ๐ซ๐ญ๐ข๐๐ข๐๐ ๐๐ฒ ๐๐ง๐๐ซ๐ ๐ฒ, ๐๐ข๐ญ๐๐จ๐ข๐ง, ๐๐ง๐ ๐ฌ๐ญ๐๐๐ฅ๐๐๐จ๐ข๐ง๐ฌ.
At the start of this geopolitical contest, the U.S. was the undisputed winner. Thanks to having the global reserve currency (USD) and the worldโs safest reserve asset (U.S. Treasuries), capital flowed into US markets, forcing countries like China to rely on the dollar for trade while financing Americaโs debt, benefiting their geopolitical opponent even more.
However, China has found a way out. Instead of recycling dollar reserves into treasuries, theyโve been buying hard assets, real estate and Western equities. Through the Belt and Road Initiative, China is also lending dollars to emerging markets in exchange for collateral like infrastructure (ports, land, dams).
But China is going further. By building a cross-bridge CBDC network with its partners, China can deepen financial ties and bypass the U.S. dollar system ever more.
All of this increasingly looks like a โheads China wins, tails US losesโ situation.
So, how can the US and its allies counteract this?
Judging by whatโs happening on Wall Street and the conversations happening in Washington DC, the US is discovering the power of Bitcoin and dollar-based stablecoins as a tool to counter these adversary efforts to challenge US geoeconomic power while reinforcing liberal value systems around the world.
For one, it can be argued that soon-to-be regulated private stablecoins are winning the fight against Chinaโs Belt and Road initiative and cross-bridged CBDC arrangements on the USโs behalf. After all, market-driven transaction volume in the biggest US dollar denominated stablecoins vastly outpacing the CBDC efforts of the Peopleโs Bank of China to-date.
Global demand for stablecoins, which are backed by US bonds, could become a crucial tool for U.S. debt financing. In a way, US denominated stablecoins act as indirect tax levied on dollar bitcoin flows. How so?
They can be viewed as a tax because foreign users indirectly "pay" by contributing to the demand for US assets, which allows the U.S. to finance its government debt more easily and cheaply. Essentially, international users of stablecoins are helping fund the U.S. government, much like how a tax supports government revenue.
Itโs quite ironic when you think about it: the rise of Bitcoin, alongside todayโs decentralized global altcoin casino, has unintentionally gifted the U.S. government a new strategic macro buyer for its debtโone poised to become even more influential in the near future. Put simply: if it werenโt for global shitcoin trading, stablecoins wouldnโt have grown as rapidly as they have.
In short, Bitcoin and stablecoins are emerging as some of the most potent geopolitical tools the US and its allies have against Eastern powers. Itโs high time key decision-makers recognize that allowing Bitcoin to flourishโpotentially even surpassing gold in monetary significanceโwould disproportionately benefit the US. After all, American citizens and companies hold a substantial portion of the global Bitcoin supply, and its adoption would fuel growth in US capital markets.
Bitcoin and the US dollar naturally complement each other, with US. dollar stablecoins serving as the crucial link between them! Stablecoin issuance will by driven by demand for Bitcoin and its rising dollar price.
lukegromen (npub1tccโฆe6fh) put it well, when it wrote: โAs the US finances more deficits w/ T-Bills, inflation rises secularly = BTC up = more stablecoins = more T-Bills = inflation up more = BTC up = more stablecoins = more T-Bills... wash, rinse, repeat.
This should also prompt the US to adopt a light tax policy on Bitcoin, recognizing that Bitcoin demand fuels stablecoin growthโand these stablecoins already act like an international "tax" on a growing global base of users that support US government debt.
#Bitcoin #Stablecoins #Geopolitics #USDollar #CBDC #Macroeconomics
I just finished reading Matthew Pinesโ brilliant paper, โ๐บ๐๐๐๐ก ๐๐๐ค๐๐ ๐๐๐ก๐ค๐๐๐ ๐ถ๐๐๐๐๐ก๐๐ก๐๐๐ & ๐ต๐๐ก๐๐๐๐,โ from the Bitcoin Policy Institute, and oooh boy, itโs amazing.
A few key points really clicked for me; I increasingly believe that the future macro-order will look as follows:
๐๐ง ๐จ๐ง๐ ๐ฌ๐ข๐๐, ๐ฐ๐ ๐ก๐๐ฏ๐ ๐ญ๐ก๐ ๐๐๐ฌ๐ญ (๐๐ก๐ข๐ง๐/๐๐ฎ๐ฌ๐ฌ๐ข๐) ๐๐จ๐ฆ๐ข๐ง๐๐ญ๐ข๐ง๐ ๐ ๐จ๐ฅ๐, ๐๐ง๐๐ซ๐ ๐ฒ, ๐๐จ๐ฆ๐ฆ๐จ๐๐ข๐ญ๐ข๐๐ฌ, ๐๐ง๐ ๐๐๐๐ ๐ง๐๐ญ๐ฐ๐จ๐ซ๐ค๐ฌ. ๐๐ง ๐ญ๐ก๐ ๐จ๐ญ๐ก๐๐ซ, ๐ญ๐ก๐ ๐๐๐ฌ๐ญ (๐๐ ๐๐ง๐ ๐๐ฅ๐ฅ๐ข๐๐ฌ) ๐๐จ๐ซ๐ญ๐ข๐๐ข๐๐ ๐๐ฒ ๐๐ง๐๐ซ๐ ๐ฒ, ๐๐ข๐ญ๐๐จ๐ข๐ง, ๐๐ง๐ ๐ฌ๐ญ๐๐๐ฅ๐๐๐จ๐ข๐ง๐ฌ.
At the start of this geopolitical contest, the U.S. was the undisputed winner. Thanks to having the global reserve currency (USD) and the worldโs safest reserve asset (U.S. Treasuries), capital flowed into US markets, forcing countries like China to rely on the dollar for trade while financing Americaโs debt, benefiting their geopolitical opponent even more.
However, China has found a way out. Instead of recycling dollar reserves into treasuries, theyโve been buying hard assets, real estate and Western equities. Through the Belt and Road Initiative, China is also lending dollars to emerging markets in exchange for collateral like infrastructure (ports, land, dams).
But China is going further. By building a cross-bridge CBDC network with its partners, China can deepen financial ties and bypass the U.S. dollar system ever more.
All of this increasingly looks like a โheads China wins, tails US losesโ situation.
So, how can the US and its allies counteract this?
Judging by whatโs happening on Wall Street and the conversations happening in Washington DC, the US is discovering the power of Bitcoin and dollar-based stablecoins as a tool to counter these adversary efforts to challenge US geoeconomic power while reinforcing liberal value systems around the world.
For one, it can be argued that soon-to-be regulated private stablecoins are winning the fight against Chinaโs Belt and Road initiative and cross-bridged CBDC arrangements on the USโs behalf. After all, market-driven transaction volume in the biggest US dollar denominated stablecoins vastly outpacing the CBDC efforts of the Peopleโs Bank of China to-date.
Global demand for stablecoins, which are backed by US bonds, could become a crucial tool for U.S. debt financing. In a way, US denominated stablecoins act as indirect tax levied on dollar bitcoin flows. How so?
They can be viewed as a tax because foreign users indirectly "pay" by contributing to the demand for US assets, which allows the U.S. to finance its government debt more easily and cheaply. Essentially, international users of stablecoins are helping fund the U.S. government, much like how a tax supports government revenue.
Itโs quite ironic when you think about it: the rise of Bitcoin, alongside todayโs decentralized global altcoin casino, has unintentionally gifted the U.S. government a new strategic macro buyer for its debtโone poised to become even more influential in the near future. Put simply: if it werenโt for global shitcoin trading, stablecoins wouldnโt have grown as rapidly as they have.
In short, Bitcoin and stablecoins are emerging as some of the most potent geopolitical tools the US and its allies have against Eastern powers. Itโs high time key decision-makers recognize that allowing Bitcoin to flourishโpotentially even surpassing gold in monetary significanceโwould disproportionately benefit the US. After all, American citizens and companies hold a substantial portion of the global Bitcoin supply, and its adoption would fuel growth in US capital markets.
Bitcoin and the US dollar naturally complement each other, with US. dollar stablecoins serving as the crucial link between them! Stablecoin issuance will by driven by demand for Bitcoin and its rising dollar price.
lukegromen (npub1tccโฆe6fh) put it well, when it wrote: โAs the US finances more deficits w/ T-Bills, inflation rises secularly = BTC up = more stablecoins = more T-Bills = inflation up more = BTC up = more stablecoins = more T-Bills... wash, rinse, repeat.
This should also prompt the US to adopt a light tax policy on Bitcoin, recognizing that Bitcoin demand fuels stablecoin growthโand these stablecoins already act like an international "tax" on a growing global base of users that support US government debt.
#Bitcoin #Stablecoins #Geopolitics #USDollar #CBDC #Macroeconomics