Bitcoin might soon become the new gold standard. And those who invest now, will eventually gain a lot.
A well known Canadian journalist thinks Bitcoin is the secret economical weapon that might help destroy Russia. He might have a point. But it means you should not miss a chance to become a part of the global process until it’s too late.
It might sound too optimistic or too exaggerated.
But once you take a good look at what’s going on in world economy you might make some intriguing conclusions.
Especially if you know something about history and are ready to learn some lessons from WW2.
So get some coffee. We’ve got a lot to discuss.
Bitcoin vs US Dollar. Really?
Mark Slapinski, a Canadian journalist, points out that many countries around the world look for ways to reduce their reliance on the US Dollar.
One of them is Russia, of course. Since horrendous Western sanctions have already almost destroyed its economy, Russia is in utter need of some ways to save its wealth.
And by Russia we mean not the government, but oligarchs, who a hurt by sanctions. They are loosing property all over the world. Their accounts in foreign banks are blocked (possibly forever). And their assets in Russia are in danger because, well, who needs those roubles after all, right?
Sanctions prevent Russian to freely convert roubles into US Dollar or any other fiat currency.
Enter the crypto.
Many crypto exchanges are already blocking Russian accounts. But, well, it’s crypto. One of the merits of the decentralised finance is the wide range of possibilities to stay in the shadows while buying or selling.
No wonder, Russians are already buying up as much crypto as they possibly can. It is seen as a clear way to bypass sanctions.
And of course, it’s mostly Bitcoin we are talking about. Bitcoin is the most powerful cryptocurrency. And it was often seen as the main rival to US Dollar even before the Russian invasion to Ukraine.
Now the role of Bitcoin is even more obvious. It’s fate is to become the main driving force of the new world economy. Or as you can put it, to become the new gold.
Why is Bitcoin the new gold? And what does that mean anyways?
Let’s go back in time to 1940s.
By the end of World War Two, the United States had acquired a majority of the world’s gold.
Many European countries, ruined in the course of war, had depleted their reserves.
These countries couldn’t return to the gold standard, and had to sign an agreement with the US. The agreement declared that the world’s currencies would be pegged to the US Dollar.
Since then, the US has managed to maintain its dominance over the global financial system. That is why the US Dollar has been one of the strongest currencies for a long while.
Many countries were not happy with the situation. Russia and China, for instance, have done a lot to move away from US Dollar. And even close allies of the US – the European countries have implemented their own collective currency to withstand the positions of the almighty American dollar.
Now the times are changing once again.
Crypto has emerged, and decentralised finance is now rapidly becoming the leading force on the market.
Sanctions against Russia might prove to be useless if the Russians are able to use Bitcoin and other cryptocurrencies to preserve their wealth.
Thus Bitcoin might prove to be the new gold. And the US will loose the upper hand in the economic sphere.
What does the US need to do with Bitcoin?
Well, there are two main conclusions to be made right now.
First is that the US need to act immediately.
And all those long talks about the Digital Dollar aren’t relevant. At least for now.
As Slapinski pointed out, if the US government wants to maintain its global dominance, and stop Russia from gaining more ground economically, it only has one choice. The US has to buy more Bitcoin.
And by more I mean more that Russia will buy.
It’s in the best interest of the US government to increase its electronic currency dominance before Russia gets the upper hand in the cryptocurrency sphere.
We already have a huge amount of evidence showing that many countries are actively relying on crypto.
Putin’s Russia is avoiding sanctions this way. Russians are already buying up as much Bitcoin as they possibly can. Countries like North Korea and Iran have used cryptocurrency to their advantage, and to the detriment of the United States. For example, it has been reported that North Korea is funding its nuclear weapons program with stolen cryptocurrency.
If the US wants to remain a world superpower, it needs to become a superpower in cryptocurrency, Slapinski says.
He is not the only one who thinks so.
The US better posture themselves to benefit from current trends, and you do that by buying Bitcoin, so you capture disproportionate value as people flood into it, says Jason Lowery, a researcher at the prestigious Massachusetts Institute of Technology (MIT).
So, Bitcoin is the new gold. Now what?
Of course, simple investments into Bitcoin can not be the only way to defeat Russia.
But this strategy could help the US remain the leading financial force in the world, while pushing Russia even farther into isolation.
And that is the only reasonable way to fight Putin without, well, actually fighting Russia. Bombs and missiles might prove to be effective, but we all know that World War Three is way to dangerous. Putin has nukes. And he has already threatened to use these extreme measures.
But Bitcoin as the new gold can be a kind of a sucker punch. Bleeding economy of Russia might eventually prevent Putin from managing the country and conducting further war.
The more Bitcoin will end up unreachable to Russians, the more painful will our collective sucker punch be.
Once again, it is only possible if the US efforts will be pointed towards Bitcoin. The allegedly powerful Digital Dollar doesn’t even exist yet. And we need to act right now – while Russian is bombing Ukraine, trying to avoid sanctions at the same time.
And of course, as soon as the market sees that the US is buying, the Bitcoin value will skyrocket.
Now it’s time to ask yourself, where exactly do you want to be at that moment?
What will happen to Bitcoin value?
Let’s put Russia aside for a moment.
Let’s even forget there is war in the center of Europe. Just for a moment.
At the time of writing, Bitcoin reached $42 000 which is a progress compared to those pathetic $32 000 the next day after Russia invaded Ukraine.
But just three years ago we were quite happy with $5 000 price tag on BTC.
Two years ago we celebrated the all time high Bitcoin value at $20 000.
In November 2021 we were surprised to see $66 000.
We now know what it tastes like. So $42 000 isn’t that sweet. But what if you owned some BTC that you had bought in 2019?
Now think of it this way.
If the US made a bet on Bitcoin while fighting with Russia, and Russian oligarchs desperately tried to invest into crypto to avoid sanctions, where would the Bitcoin value go?
And somewhere in 2025 with every BTC worth, let’s say, $125 000 what would you feel looking back at the prices of spring 2022?