Seeds of Wisdom RV and Economic Updates Tuesday Evening 7-23-24
Good Evening Dinar Recaps,
BRICS IS MAKING PREPARATIONS FOR A US DOLLAR COLLAPSE
"According to a Russian IMF representative, BRICS is ready to offer an alternative to the US Dollar amid the currency’s collapse, and the bloc must prepare for such an instance. The alliance, consisting of Russia; India, China; Brazil; South Africa; and supporting nations, has been working to abandon the US Dollar for some time."
"The BRICS bloc is working to develop a new BRICS currency to replace the US dollar, alongside local currencies between nations. In an interview with RIA Novosti published on Friday, Russian IMF rep Alexey Mozhin noted that the shortcomings of the current financial system are becoming more apparent.
Furthermore, he points out that many publications have started to mention BRICS as a group that will offer a successful alternative to the greenback."
“Such a proposal is being discussed,” the director told RIA Novosti. “In the event of the collapse of the dollar and the international monetary system, it will be necessary to turn the said BRICS accounting unit into a real currency, backed by exchange goods.”
BRICS CURRENCY TO SERVE AS SUBSTITUTE IF US DOLLAR COLLAPSES
"The BRICS bloc has turned to blockchain technology for its brand-new payment system, according to reports. Indeed, its efforts have sought to build a competing currency built on digital assets."
"The US Dollar is still a ways away from crashing altogether, however, the path is there for BRICS to do damage. The greenback is still the global reserve, but a mounting US Debt has ensured that it won’t remain a fact forever.
"Furthermore, support around the BRICS bloc has grown over the past few years, with more countries likely to receive invites to join in 2024.
With more support in numbers and finances, BRICS could develop a strong contending currency to fight the US dollar."
@ Newshounds News™
Read more: The Republicans Voice
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GOLD, SILVER: India's TAX CUT to Offer a Bullish Boost for the Metals?
"Today, India slashed its import tax on gold and silver, a move that could further boost demand for both precious metals in the world’s second-biggest gold market and support higher prices globally. The move will cut taxes on gold and silver imports by more than half, lowering duties from 15 percent to 6 percent."
"India will also lower the import tax on platinum to 6.4 percent."
"World Gold Council Indian operations CEO Sachin Jain told Reuters the tax cut is “a massive step in the right direction.”
“It will reduce the incentives for smuggling of gold. It will create a level playing field for honest industry stakeholders.”
"Gold was up about $14 in overseas trading after officials announced the tax cut. Even with the high import taxes, Indian gold demand has been strong. Through the first five months of 2024, gold imports into India increased by 26 percent year-on-year, with 230 tons of gold flowing into the country. This is despite record-high prices."
"Indians have historically had an affinity for gold. Indian households own an estimated 25,000 tons of gold, and that likely understates the amount given the large black market in the country. Gold is deeply interwoven into the country’s marriage ceremonies and cultural rituals. Indians have long valued the yellow metal as a store of wealth, especially in poorer rural regions."
"Gold isn't considered a luxury in India. Even poor Indians buy gold. According to a 2018 ICE 360 survey, one in every two households in India had purchased gold within the last five years. Overall, 87 percent of Indian households own some gold. Even households at the lowest income levels in India hold some of the yellow metal. According to the survey, more than 75 percent of families in the bottom 10 percent of income managed to buy some gold."
@ Newshounds News™
Read more: Investing
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146 TRILLION
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Read more: https://x.com/SMQKEDQG/status/1780670320522747961
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Warren Buffett Dumps $1.5 Billion Worth Bank of America Shares
Ace investor Warren Buffett’s investment arm Berkshire Hathaway has dumped $1.5 billion worth of Bank of America (BAC) shares. The recent regulatory filings show that the billionaire offloaded 33.9 million Bank of America shares. The BAC stocks were sold at an average price of $43.56 per share. After the sale from Berkshire Hathaway, BAC stocks fell to $42.30 with a decline of 1.40%.
The reduction is significant and has come as a surprise to the US stock market. Warren Buffett is known to hold stocks for the long term and not offload them mid-way. However, despite the sell-off, Warren Buffett is still the second-biggest holder of Bank of America stocks. Berkshire Hathaway holds a 10.8% stake in BAC after falling from the top position to the second due to the sell-off
@ Newshounds News™
Read more: Watcher Guru
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IS TRUMP RIGHT TO WORRY THAT CHINA COULD TAKE OVER CRYPTO?
Does China regret banning Bitcoin mining in 2021? Could it opt back in? Can a single nation even control decentralized assets like BTC?
It’s only recently that Donald Trump has paid any attention to crypto. But now he wants to be the “crypto president,” and he’s raising digital assets as a geopolitical issue.
Asked on July 16 why he’s suddenly embracing the crypto community, he told Bloomberg:
“If we don’t do it, China is going to pick it up and China’s going to have it—or somebody else, but most likely China.”
In the interview, Trump explained how the recent experience with his “Mugshot” NFT Collection “opened my eyes” to cryptocurrencies, saying, “80% of the money [from the NFT sale] was paid in crypto. It was incredible.”
“So we have a good foundation [i.e., crypto]. It’s a baby. It’s an infant right now. But I don’t want to be responsible for allowing another country to take over this sphere,” he added.
His remarks raised several interesting questions — and not just whether China, which banned crypto trading and Bitcoin mining in 2021, is even interested in reentering the crypto trading and mining markets.
It touches on the relationship between governments and the crypto/blockchain sector generally.
To what extent can any single sovereign nation control decentralized and diversified digital assets like Bitcoin and Ethereum.
Is it even possible?
Why China?
China was once a major crypto player. The largest crypto exchanges, such as Binance, were located in China, and as much as 75% of Bitcoin mining took place on the Chinese mainland, according to estimates.
But in 2021, China cracked down on crypto trading and mining, and by July of that year, Bitcoin mining had essentially vanished on the mainland.
Recent developments, however, have raised speculation “that the Chinese government may be warming to cryptocurrency and that Hong Kong may be a testing ground for these efforts,” noted Chainalysis in October.
Indeed, in April 2024, the central government approved the launch of several Bitcoin exchange-traded funds (ETFs) in Hong Kong. Some observers think China wants to make Hong Kong a crypto hub — despite a continued trading ban on the mainland.
China’s Bitcoin ban a “strategic blunder”
“Absolutely,” Daniel Lacalle, chief economist of Tressis, told Cointelegraph.
“Beijing’s 2021 mining crackdown was a strategic blunder,” Emiliano Pagnotta, associate professor of finance at Singapore Management University, told Cointelegraph.
China wants to maintain tight control of capital outflows on the mainland, Wang, assistant professor in the economics department at the University of Essex, told Cointelegraph, which is why it banned crypto trading
But Hong Kong, while controlled by China, has a different economy. It has always had open market policies and free capital flow, and crypto might find a natural home in the former British colony. Wang added:
“Hong Kong serves as the hub to allow some capital flow in and out of mainland China, which is important for Hong Kong and also for mainland China.”
“The digital asset ETF market in Hong Kong has indeed seen substantial growth since its launch in April 2024,” Patrick Pan, chairman and CEO of OSL — a crypto-exchange now operating in Hong Kong — told Cointelegraph.
Pan added that mainland China “has maintained a stringent stance against cryptocurrency trading and speculations.”
Pan points out, however, that China has largely accepted the importance of cryptocurrencies’ underlying blockchain technology.
“China’s development and gradual rollout of the digital yuan showcase an interest and capacity to embrace blockchain technologies, which bring long-term benefits to the country’s financial infrastructure through enhanced efficiency and security of its financial systems,” said Pan.
China may be softening its stance on crypto
Chinese government decision-making is opaque, so one may never know if China truly regrets its 2021 crypto ban. But what is clear is that “the country is reassessing its approach, especially as it sees the strategic value in digital assets,” Zennon Kapron, founder and director of consulting firm Kapronasia, told Cointelegraph, adding:
“The softening stance in Hong Kong could be a strategic move to remain competitive in the fintech and digital finance space without fully reversing its mainland policy.”
But is it too late?
“China still has advantages, such as access to cheap hardware and electricity in certain regions,” Kapron allowed. “If the government were to provide incentives or loosen restrictions, it’s conceivable that some level of dominance could be reestablished.”
It wouldn’t be easy, though. “The global mining landscape has become more diversified, making it harder for any single country to dominate,” observed Kapron.
“Bitcoin mining is not like making CPUs, but more similar to producing solar panels, building railways, etc. China has the capacity and even the comparative advantage in this type of mass production.”
Crypto trading may be a different matter, though. China is unlikely to change its trading ban on the mainland unless it first changes its capital markets policy, said Wang.
Pagnotta, by comparison, said China could still be a force within the crypto sector, particularly if it demonstrates more pragmatism and regulatory clarity.
“China now seems more open to the crypto industry and has allowed the launch of Bitcoin and ETH ETFs in Hong Kong,” said Moreno.
“Despite China’s ban on Bitcoin mining, Chinese mining pools still hold nearly 54% market share,” CryptoQuant founder Ki Young Ju posted on July 1. “While not all participants in these pools are Chinese, some mining farms might still be operating covertly in China, with authorities possibly concealing data.”
China’s central government also remains a Bitcoin “whale” as a result of its past activities — holding 190,000 BTC, or about 1% of the Bitcoin currently in existence. This is not a trivial amount.
Could China dominate crypto again?
Wang, for his part, believes that if China really sets its mind to it, it could still “play a super important, if not dominating, role” in the global crypto sector.
Not only does it have natural advantages, but there is a huge demand for using cryptocurrencies to send Chinese assets abroad, Wang added, especially given China’s tight capital market controls.
The biggest cryptocurrency exchange platform in the world in terms of trade volume is still Binance, “which is a company started in China by a Chinese but later moved abroad, and still 20% of Binance’s trade comes from China,” noted Wang.
As per Trump’s remarks, is crypto really emerging as a new theater of competition between the great powers? According to Pagnotta:
“Trump wants votes, and he understands that tens of millions of Americans hold digital assets and see it as an important electoral issue. Drawing a contrast to Biden or China in this regard is politically astute.”
“At a more profound level, Trump does not want a Chinese/BRICS [i.e, Brazil, Russia, India, China, South Africa]-led central bank digital currency [CBDC] to become dominant. Even if he did not suddenly become a genuine Bitcoiner, he surely comprehends enough game theory to realize that Bitcoin is the politically neutral global property rights system in the 21st century,” added Pagnotta
In doing so, the former US president could simply be applying the ancient wisdom that “the enemy of my enemy is my friend.” Still, others believe the suggestion that China may once again try to gain dominance in the global crypto market is just plain wrong. Leading cryptocurrencies like Bitcoin and Ether are too diversified and decentralized now to allow control by any one sovereign state.
“China’s influence in the crypto market may grow, particularly through initiatives like the digital yuan,” said Kapron, “but achieving dominance over decentralized cryptocurrencies is a different challenge altogether.”
Trump’s recent utterances may reflect a strategic concern, continued Kapron, “but the reality is that the decentralized and diversified nature of these digital assets acts as a significant barrier to dominance by any single nation.”
Added economist Lacalle:
“There is no such thing as nationalist crypto. The beauty of the crypto market is that it is completely diversified and decentralized. The concept of government control of crypto makes no sense to anyone that understands independent currencies.”
@ Newshounds News™
Read more: COIN TELEGRAPH
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