1. Gold, oil, BTC?
The collapse of the Bretton Woods system, the cracks in the petrodollar, and the rise of Bitcoin signify that the anchor points that change with the times are essentially the dollar's repeated adaptive evolution.
The establishment of the Bretton Woods system in 1944 marked the dollar's binding to gold ($35 per ounce) as the 'ultimate anchor' of the global monetary system. The core logic of this design is that the physical scarcity of gold backs dollar credit, while the network effect of the dollar amplifies the liquidity of gold. However, the explosion of the Triffin dilemma revealed the fatal flaw of the system—global trade expansion requires dollar outflow (US trade deficit), while the maintenance of dollar credit relies on US surplus and sufficient gold reserves. In 1971, Nixon announced the decoupling of the dollar from gold, freeing the U.S. from the gold shackles for the sake of its hegemony.
It has been proven that any currency system rigidly bound to physical resources will eventually collapse due to the irreconcilability of resource scarcity and economic expansion. The curtain call of the gold dollar forced the U.S. to seek a more flexible medium.
The first oil crisis in 1973 gave Nixon the answer; the importance of oil to modern industry is self-evident. In July of the following year, at Nixon's directive, the new U.S. Treasury Secretary William Simon and his deputy Gerry Parsky rushed to Saudi Arabia, the world's largest oil producer, to sign the (irrevocable agreement) to break the deadlock after the collapse of the gold system: the U.S. promised to provide Saudi Arabia with comprehensive military protection and security guarantees, while Saudi Arabia agreed to price all its oil exports in dollars and to purchase excess oil revenue directed towards U.S. debt, exchanging military protection for Saudi Arabia and other oil-producing countries' acceptance of the petrodollar as the sole pricing currency for oil transactions.
Thus, we enter the 2.0 era—oil replaces gold as the new anchor of dollar credit. The petrodollar system operates in a closed loop through 'oil trade—dollar repatriation—US debt purchase.' Wall Street packages these petrodollar debts into derivatives (with a scale of $610 trillion in 2023), diluting credit risk through 'debt monetization.'
The essence of this cyclical logic is that the U.S. levies a 'seigniorage tax' on the world through oil trade. However, the current U.S. fiscal deficit is extremely high (7% of GDP), and the total debt has already surpassed $36 trillion this year. The entire system has long since evolved into a Ponzi cycle of borrowing new to pay old. As the de-dollarization of oil trade gradually expands, this cycle will begin to collapse from the lack of anchor points. So what comes next? Who will fill the next fifty years after oil?
Trump currently holds two swords, Nvidia and Bitcoin. In the previously high-tech narrative path of AI, Nvidia has almost played the role of the 'digital Middle East'; everyone needs computing power, but the computing power can only be produced by me. Unfortunately, a certain Eastern country has found a path where AI computing demand can also be small and exquisite. Therefore, at least until the complete arrival of the AI Agent era, computing power and digital oil cannot be fully equated (or some countries can be self-sufficient in oil).
Let’s look at another sword: Bitcoin. The concept of using Bitcoin as a strategic reserve originated from Senator Lummis's proposal submitted to Congress last year. Its supporting logic is that the purchasing power of the dollar has been continuously declining in recent years, while Bitcoin's average annual growth rate during the same period reached 55%. Its excellent anti-inflation attribute can be seen as a new type of value storage tool to replace gold.
Trump has even said: 'Give them a little crypto check. Give them some Bitcoin, and then wipe out our $35 trillion.'
Whether it is pegged to the dollar or repaying US debt, I have always opposed these concepts in my previous articles. The first point mentioned above is the collapse of the Bretton Woods system. As a digital currency with a cap of 21 million, Bitcoin's scarcity is even greater than that of gold. The U.S. cannot repeat the Triffin dilemma.
Second, the volatility is too large and the reserves are insufficient. Based on the current reserve of 200,000 Bitcoins in the U.S., the asset value is less than $20 billion. This only accounts for 0.056% of the scale of US debt. To achieve effective anchoring, at least 30% of the circulating supply needs to be held (about 600,000 coins), or Bitcoin’s value must be raised dozens of times and maintain a long-term stable price. But clearly, both options are not very realistic.
Third, pegging the dollar to Bitcoin will clearly exacerbate the marginalization of the dollar. How to convert Bitcoin into a global tax base is another question.
From the current implementation of strategic reserves, it is clear that the Trump administration cannot find a better entry point in the short term. However, this card was played so quickly that I have to rethink whether they have a bigger trump card.
Based on my personal thoughts, I extend the speculation from the previous article:
1. Bitcoin's scarcity does not mean that all cryptocurrencies are scarce; most public chain tokens have deflationary mechanisms. The dollar is currently based on oil and represented by gold. The composition of digital Fort Knox can be mixed: BTC is gold, and public chain tokens like ETH or SOL are oil. So, with the large-scale adoption of the 'crypto capital', can a crypto version of the American closed loop be formed? For example, various stablecoin projects such as Usual and Tether can still promote so-called dollar settlements, and their composition mechanism or profit source is closely related to US debt. Does this bear some similarity to the petrodollar system?
2. At the current stage, not buying or selling is reasonable, but if the killer move is limited to this, then this news should not have been announced so early. Trump is not a fool, nor is his crypto team behind him. There are rumors circulating in the industry that the U.S. sovereign fund (which is still in the planning stage) will purchase cryptocurrencies. I actually agree that this sovereign fund is his trump card.
3. Once thought in smaller terms, Trump was just issuing some empty checks to the crypto circle for the interests behind him. But looking at the current situation, we might have to think bigger; it is only a matter of time before mainstream countries follow suit with strategic reserves. Personally, I believe BTC is the most acceptable, while the status of SOL and even XRP may surpass ETH (depending on the adoption progress).
4. The largest unit of the crypto struggle is no longer public chains. Trump is clearly trying to consolidate the largest CEX, public chains, and various giant projects. However, how to consolidate remains a question, and how will resistors fight back?
5. There are rumors on Wall Street that Trump is deliberately creating a man-made recession to pressure the Federal Reserve to cut interest rates. Whenever the market is about to improve, it will be met with a blow from Trump and Musk (Department of Government Efficiency). So does Trump also intend to suppress crypto?
1. Gold, oil, BTC?
The collapse of the Bretton Woods system, the cracks in the petrodollar, and the rise of Bitcoin signify that the anchor points that change with the times are essentially the dollar's repeated adaptive evolution.
The establishment of the Bretton Woods system in 1944 marked the dollar's binding to gold ($35 per ounce) as the 'ultimate anchor' of the global monetary system. The core logic of this design is that the physical scarcity of gold backs dollar credit, while the network effect of the dollar amplifies the liquidity of gold. However, the explosion of the Triffin dilemma revealed the fatal flaw of the system—global trade expansion requires dollar outflow (US trade deficit), while the maintenance of dollar credit relies on US surplus and sufficient gold reserves. In 1971, Nixon announced the decoupling of the dollar from gold, freeing the U.S. from the gold shackles for the sake of its hegemony.
It has been proven that any currency system rigidly bound to physical resources will eventually collapse due to the irreconcilability of resource scarcity and economic expansion. The curtain call of the gold dollar forced the U.S. to seek a more flexible medium.
The first oil crisis in 1973 gave Nixon the answer; the importance of oil to modern industry is self-evident. In July of the following year, at Nixon's directive, the new U.S. Treasury Secretary William Simon and his deputy Gerry Parsky rushed to Saudi Arabia, the world's largest oil producer, to sign the (irrevocable agreement) to break the deadlock after the collapse of the gold system: the U.S. promised to provide Saudi Arabia with comprehensive military protection and security guarantees, while Saudi Arabia agreed to price all its oil exports in dollars and to purchase excess oil revenue directed towards U.S. debt, exchanging military protection for Saudi Arabia and other oil-producing countries' acceptance of the petrodollar as the sole pricing currency for oil transactions.
Thus, we enter the 2.0 era—oil replaces gold as the new anchor of dollar credit. The petrodollar system operates in a closed loop through 'oil trade—dollar repatriation—US debt purchase.' Wall Street packages these petrodollar debts into derivatives (with a scale of $610 trillion in 2023), diluting credit risk through 'debt monetization.'
The essence of this cyclical logic is that the U.S. levies a 'seigniorage tax' on the world through oil trade. However, the current U.S. fiscal deficit is extremely high (7% of GDP), and the total debt has already surpassed $36 trillion this year. The entire system has long since evolved into a Ponzi cycle of borrowing new to pay old. As the de-dollarization of oil trade gradually expands, this cycle will begin to collapse from the lack of anchor points. So what comes next? Who will fill the next fifty years after oil?
Trump currently holds two swords, Nvidia and Bitcoin. In the previously high-tech narrative path of AI, Nvidia has almost played the role of the 'digital Middle East'; everyone needs computing power, but the computing power can only be produced by me. Unfortunately, a certain Eastern country has found a path where AI computing demand can also be small and exquisite. Therefore, at least until the complete arrival of the AI Agent era, computing power and digital oil cannot be fully equated (or some countries can be self-sufficient in oil).
Let’s look at another sword: Bitcoin. The concept of using Bitcoin as a strategic reserve originated from Senator Lummis's proposal submitted to Congress last year. Its supporting logic is that the purchasing power of the dollar has been continuously declining in recent years, while Bitcoin's average annual growth rate during the same period reached 55%. Its excellent anti-inflation attribute can be seen as a new type of value storage tool to replace gold.
Trump has even said: 'Give them a little crypto check. Give them some Bitcoin, and then wipe out our $35 trillion.'
Whether it is pegged to the dollar or repaying US debt, I have always opposed these concepts in my previous articles. The first point mentioned above is the collapse of the Bretton Woods system. As a digital currency with a cap of 21 million, Bitcoin's scarcity is even greater than that of gold. The U.S. cannot repeat the Triffin dilemma.
Second, the volatility is too large and the reserves are insufficient. Based on the current reserve of 200,000 Bitcoins in the U.S., the asset value is less than $20 billion. This only accounts for 0.056% of the scale of US debt. To achieve effective anchoring, at least 30% of the circulating supply needs to be held (about 600,000 coins), or Bitcoin’s value must be raised dozens of times and maintain a long-term stable price. But clearly, both options are not very realistic.
Third, pegging the dollar to Bitcoin will clearly exacerbate the marginalization of the dollar. How to convert Bitcoin into a global tax base is another question.
From the current implementation of strategic reserves, it is clear that the Trump administration cannot find a better entry point in the short term. However, this card was played so quickly that I have to rethink whether they have a bigger trump card.
#BNBChainMeme热潮 #你看好哪一个山寨币ETF将通过？ #ETH
