Topic: New currency from BRICS countries (Read 1095 times)

People will choose the currency that's most convenient for them. The USD is the preferred currency of the public because of its position as the world's reserve currency. But that won't last for long, especially when with the weaponization of the USD. Countries are slowly moving away to other currencies that are more open for global trade.

If BRICS' new currency gathers the attention of countries worldwide, it could easily displace the USD as the world's next reserve currency. Backing its value with Gold is the first step towards achieving said goal. I would be surprised if BRICS goes as far as backing its own currency with Bitcoin. That would be even better for the world economy. We can't predict what will happen in the future, so lets hope for the best.

The BRICS (Brazil, Russia, India, China and South Africa) have demonstrated their intentions to abandon the USD as a global reserve currency.There's no need for debate because no matter what,people still choose the US dollars to BRICS.
The BRICS is yet to stand on its own and manifest properly.The creation of BRICS cannot decline the work force or influence of the US dollar.

About BRICS dominance is a very funny joke.
No, I understand that a lot of people, instead of improving the life and economy of their country, are living the dream of "the collapse of the USA", and constantly consuming their products, goods and technologies, thus supporting the USA
I don't understand how people try to make wishful thinking so primitively.

Dominance is possible if someone/something is more powerful, stable, and wealthy.

Now just look at this "alliance" - It seems that only India's economic situation is more or less good today. And the rest are either global problems or fakes
China is a huge internal economic problem. They found a way out, to pull the yuan on all "BRICS test subjects", exporting inflation and problems to them.
Russia is just a fake country and a pariah.
Brazil - wave after wave of economic crises are hitting the economy
If I am wrong - correct me, and provide data on the stability of other potential participants of this "union to save china"

Sadly, that's the hard truth. BTC is extremely-volatile, which means you can either win big or lose it all in an instant. BRICS countries need something stable that would help them move money across borders with ease. The only logical option would be to make their own currency that would be under their complete control. I'd imagine the new currency would be digital, making use of Blockchain tech for cross-border payments. And backing it with Gold, would make sure the currency will retain its purchasing power no matter what. Similar to what the US did in the old days (except Blockchain tech didn't exist back then).

Whenever BRICS' efforts to displace the USD as the world's reserve currency will become a success or a failure, it's yet to be seen. It's going to take years, if not, decades before this happens. Either way, BTC will keep soaring towards new heights thanks to its decentralized and censorship-resistant design. Just my opinion

Gold reserves by country. China is a first nation in the table and their gold reserves is more than double of Japan reserves. They have 2,068.36 tonnes than 845.97 of Japan.

In short, no.

In more detail, China is a very mysterious country with a closed economy that is difficult to externally analyze. There are quite good reasons to believe that in addition to the huge official gold and foreign exchange reserve of $3+ trillion, China has a commensurate shadow gold and foreign exchange reserve, which China uses to artificially maintain an undervalued yuan and actively spends on colossal infrastructure projects, such as building millionaire cities "for growth". By some estimates, China consumes 40 times more concrete than the United States, with comparable economies.

It appears that the US is gradually recognizing the potential threat to its economy, but it seems to be resorting to its usual approach of pressuring African countries, warning them about potential consequences if they don't comply. The US has assigned Nuland to visit South Africa before the upcoming BRICS meeting, aiming to convince them to align with their position. Additionally, four more countries have joined, bringing the total number of supporters to 44.

Interest in joining BRICS from all countries even from US-slave countries like France, shows the New World Order and the weakening of United States and the fiat they keep printing called dollar! However, this "weakening" is slowly happening and I don't think the chances of a catastrophic collapse is that high right now hence bag holding a lot of dollars in reserve while slowly dumping it as China is doing is the low risk move.

P.S. Is there any source that shows China's reserve currencies explicitly separated by their type? Because it seems like all sources including the state administration report an aggregated value of all assets (not just dollars) converted to dollar, it even states the change in value is due to "asset price changes" and I know some sources like worldbank reporting the $3.17 trillion include China's gold reserves in it.

Taking care of an individual capital and investment is more easily than doing it for a nation. I can stake my capital, accept risk and afford to lose it but honestly I can not do it with my national treasury. Especially if I don't host a public referendum for that decision. A national treasury can not be staked with a very volatile asset like Bitcoin.

Governments can control their fiat currrencies, CBDCs and adjust their policies to support their currencies. They don't control inflation well but at least they will feel safer when they can control their currencies with their power and policies. With Bitcoin, they know that they can not control it because of its high decentralization.

I agree with you that a small portion of a national treasury as a reserved asset is acceptable by assessing risk.

It will absolutely take a long time for that to happen. The system will have to adjust for it as it will be a long process and change. However, it will mostly not affect the bitcoin system as widely as others may say, after all this change is mostly a political talk and will focus on that for awhile.

Yep, to be precise, 22 countries have already submitted official applications for membership in the BRICS and about the same number of informal applications. If all these requests are granted, BRICS will become not only the largest economic alliance in the world, but will also take a dominant position. I have already said earlier that the most interesting moment in the upcoming BRICS summit will not be the creation of a common BRICS currency (this is a very difficult project to implement and a matter for a more distant future), but in what architecture the BRICS will expand, because the issue of expansion itself has actually already been decided. Simply put, will the expansion continue in a peer-to-peer manner, as was already the case with South Africa's entry into the alliance, or will it be a second-level architectural solution. We'll see soon.

China USD reserves are around 3 Trillon USD, so China itself will suffer huge blow if dollar collapse unless they get rid of there all USD holdings. Meanwhile there are news that 40 more countries are in line to join BRICS and this is enough to prove that the platform is getting popular globally. The most interesting part is that gulf countries are also taking interest in joining BRICS and if that happens then what will be fate of billion of USD that belongs to gulf countries but residing in US banks?

That's the problem - you're wrong
They have NOT eliminated dollars from international trade. They still trade with the rest of the world in dollars. Because, for example, China cannot buy Western technology for yuan. And Russia can't buy anything of quality for their rubles )
And if you do not read the ramblings of "experts" like the one you quoted. like the one you quoted, and really study the subject area, you will realize that there was a partial replacement and not by the common currency of BRICS, but by yuan, and not to replace the dollar, but to "pump" the problems of the Chinese economy on these unfortunates )
PS. I also recommend to study, for example, the formation of China's reserves, where the growth of investments in U.S. securities, as well as hysterical attempts of Russia to get at least some currency instead of yuan and rupees.
I applaud India - to "divorce" Russia in such a way is a financial show of world scale

I agree. This is more on the political side now. And it's heavily being discussed for a long period now. I think OP thought that a new currency will affect BTC somehow but it's just way out of the system as it is more of a political matter.

It is not meant to belittle, but economic power can affect the geopolitical conditions of each country and look further at how the conditions of countries that do not have economic power are treated. The population size does not affect whether or not developing countries and in fact a large population will hinder economic processes from running perpendicularly, unskilled work or labor will only be needed differently in other countries and in their own country it is not certain that they will get a decent job.

India cannot be equated with China which has developed so much and China's economic power is so strong because they control several products to the Asian market, China is also strong in terms of technology and many scientists who were born there have succeeded in creating miracles that have never been discovered by other countries.

Not talking about the possibility or not, but the opportunity to reach the dollar domination stage will be difficult to break in the near future. Even though many countries have eliminated the dollar in international trade, the power of the dollar is still very strong and this is proof that breaking the domination of the dollar is not something easy. Optimism is indeed important for some countries that have joined the BRISC, but they need to strengthen their economy first to compete under any conditions.

I think the scenario described is from the realm of fiction. And not even science fiction.
Reasons? Simple - none of the BRICS countries, or even all of them together, will be able to compete with the US and its economy.
And especially if you look into the eyes of truth and realize that all the BRICS attempts to get away from the dollar, at best, will turn out to be an approach to the yuan, and the import of Chinese economic problems, or rather pumping them to countries that have left the normal international settlements, going to the "monopoly" yuan from China.
Of course, we can assume a certain situation with the total collapse of the U.S. economy.... But rather the economies of BRICS members will show themselves from the bad side, and by the way they already show themselves - today Russia, China, Brazil,... have large-scale problems. And no one is going to save them or subsidize them

And Bitcoin, with its volatility, uneven distribution of mining (you can say monopolization by some market participants) - will not be able to become a stable and secured currency.

Yes, the risk will be too much. Bitcoin goes up and down, and it would be too much of a loss if countries starts adapting it as a formal currency. Hence, it is truly more favorable and proper to have a new currency compared to adapting bitcoin currency. Additionally, after all, the new development of currency is more of a way for BRICS to ultimately remove themselves from US colonialism.

As much as I like bitcoin but it is not yet ready for mass adoption, the price of it is too unreliable for such a large long term commitment like what BRICS countries are making. Imagine if you buy a million barrels of oil (what oil tankers usually carry) worth $80 million in bitcoin and the price drops by 10% which is a normal thing in bitcoin. That is $8 million loss. That's not favorable.
However a centralized currency created and controlled by them is a lot more reliable because they dictate its value (exchange rate) so it can be kept fixed.

At this point bitcoin is good for small size trades and as a small portion of the reserved assets of the country.

Because as long as you can answer my question, you will get the question you are asking me.

Well, as pooya87 said, I'm not correct in saying that they have eliminated USD in international trade, but they are reducing their reliance on it and things are still going. You are just trying to argue and always think you are right, you have no proof that what you say will definitely happen. Therefore, I do not want to argue at length because everyone has their own arguments and stubbornness, even if we are wrong, we will never admit it. So I like to let time answer all, I don't rush to conclude who is right and who is wrong, I have enough time to wait with you.

I think it will take decades before BRICS countries defeat the US Dollar for good. The "greenback" is still too powerful to go away that easily. But I'd say this is the beginning of the end for US hegemony. I've thought BRICS would use BTC as their main currency especially to avoid sanctions and whatnot. But now I see that won't be the case with their plans to make a currency of their own backed by Gold. Whenever this will become a success or a failure, it's yet to be seen.

I don't think this will have a negative impact over BTC, especially when the Bitcoin blockchain is decentralized. It's likely BTC will survive alongside a basket of Fiat currencies for generations. Who knows how BRICS' actions will shape the future? Just my thoughts