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42 sats \ 4 replies \ @Cje95 OP 30 Jul \ parent \ on: The Interesting Case for the US to Greenlight Dollar Pegged Stablecoins econ
There are a lot of issues that counties face when not dealing with the dollar and we have seen this occur. After people freaked out about the Saudi news the Saudi oil company issued its bonds in USD. With India, Russia, and China settling in any of these currencies is an issue due to volatility. India has been burned several times already and has pushed back against these settlements.
With China pulling back on the Silk and Road the only big bailout entities now are the World Bank and IMF. Silk and Road was the none USD equivalent but China cannot afford it anymore. For stability of your country USD is the defacto default and nothing has challenged that. The idea of a BRICS currency has one critical issue and that is none of these countries want to give up control. China and Russia are both either at the population cliff level or about to be so there economies are in for a brought time. India has the inside trade to take control but China would never want that to happen.
I'm also very skeptical of a BRICS currency. The persistent demand I see for non-dollar currencies comes from countries who are cut off by US sanctions. Russia, Cuba, and Venezuela all still have economic ties to the rest of the world and something other than dollars has to facilitate that.
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All of those countries though have incredible internal issues they are having to deal with on a consistent basis which makes it even harder for a partner to take the government at the time at its word. Putin while he still seems strong is dealing with a war that he has to continue not because he even wants to but because if those soldiers come back home and have to deal with the economic conditions they will rise up. \
Cuba is essentially an island that is closer to the US than anyone. Without the USSR they had to work to forge better ties with the US and those have led to huge demonstrations. With Venezuela, we say the Petro fail and now they cut ties with what 6 or 7 Latin American countries surrounding them yesterday? They wont be able to North Korea themselves because they cannot provide food or power for themselves.
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I get that they're all a mess, but that doesn't have anything to do with my point. They can't dollarize, unless the sanctions are dropped.
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Off topic, but thank you for highlighting the existence of this wonderful resource on another platform. Perhaps without you it would not have been possible to get here.
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