Escalating geopolitical tensions and tariffs established during the Trump administration are prompting countries to reassess their reliance on the US financial system.
A recent analysis from an investment management company underscores how the US’s use of trade and financial systems as leverage is sparking a growing interest in neutral payment methods. Once considered a theoretical concept, these transaction frameworks are now being tested in practical scenarios.
This shift has led to Bitcoin gradually being recognized as a viable financial tool rather than merely a speculative investment for nations aiming to decrease their dependency on the US dollar.
According to the analysis, China and Russia are at the forefront of this transition, having used Bitcoin and other digital currencies to settle specific energy transactions.
This aligns with a prior report indicating that Russian oil companies have been utilizing cryptocurrency for oil trades with China and India in an effort to circumvent Western sanctions.
Market analyst Jonathan Hammel noted that confidence in US financial supremacy began to wane in 2022 when the federal government froze Russian assets and restricted access to dollar-clearing systems. He argues that this decision marked a pivotal moment, increasing global interest in alternative networks such as Bitcoin.
He stated:
“The US Government crossed a significant threshold in 2022 by seizing Russian assets at the Federal Reserve and preventing transactions within the USD network (including western banks and SWIFT). This move (by the Biden administration) only intensified the movement away from the USD toward alternative currencies/networks, including BTC. The trend will continue to accelerate amid the current trade tensions.”
Furthermore, this transition is not confined to the world’s major economies. Bolivia is contemplating the use of cryptocurrency for energy imports, while French energy giant EDF is investigating Bitcoin mining to utilize surplus electricity that would otherwise be sent to Germany.
Matthew Sigel highlights these instances as early signs of Bitcoin’s changing role in global finance. He notes that the digital currency is gaining acceptance in markets eager to reduce exposure to the dollar and navigate US-centric financial systems.