BRICS countries push for new world reserve currency
The BRICS countries announced after their latest meeting that they are considering jointly working on a new world reserve currency.
The BRICS countries announced after their latest meeting that they are considering jointly working on a new world reserve currency. This was reported by the Russian news agency Tass. The plan is to replace the U.S. dollar as the world reserve currency and end its dominance.
One of the arguments for a new world reserve currency is often cited as the share of the global population: about three billion people live in BRICS countries, while only 11 percent of the world's total population lives in G7 countries.
Putin as the driving force
Due to sanctions and being barred from SWIFT, Russia can’t fully exercise its economic influence. It’s clear why, in particular, Putin is pressing on the plan for a new world reserve currency under BRICS leadership.
"The question of introducing an international reserve currency based on a basket of currencies from our countries is being studied. We are prepared to engage in open cooperation with all fair partners," he said at the conference.
Battle for monetary sovereignty: Bitcoin as an alternative?
Earlier this year, in a speech at the International Economic Forum in St. Petersburg, Putin fired a shot at the U.S. dollar and the government behind it: "Nothing lasts forever. The Americans think they and the dollar are exceptional. And if they think they’re exceptional, that means everyone else is second-rate."
In today’s tense market phase, a new system could emerge from the East-West conflict: cryptocurrencies. El Salvador and the Central African Republic are already betting on Bitcoin and its decentralized promise. Venezuela and Iran are also trading in cryptocurrencies.
With the euro recently hitting a historic low, many may be worried about the current situation.
Banks may hold crypto
Banks appear to be responding to the size of the crypto market. At the end of June, the Bank for International Settlements (BIS) allowed regular banks to hold crypto assets like Bitcoin. According to this article, the total risk from "Group 2 crypto assets" should be minimized to 1% of Tier 1 capital. It’s not yet clear to what extent banks have complied so far.
