The fiat and bitcoin payments app, Strike, has launched its “first fully-featured region outside the U.S.” According to Jack Mallers, the founder and CEO of Strike, the African continent presents “immense opportunities for financial innovation and economic freedom.” High Inflation and Costly Remittances Render Africa a Favorable Market for Strike Strike, a payments app supporting […]
Bitcoin News
Economist Warns the Demise of US Dollar Hegemony Is ‘Really Upon Us’
Economist Stephanie Pomboy has warned that the “demise of the U.S. hegemony is really upon us,” emphasizing that the Biden administration and many U.S. policymakers in Washington “are just sleeping right through it.” She pointed out that a growing number of nations are reducing their reliance on the U.S. dollar and opting to use local currencies in international trade.
‘The Demise of the US Hegemony Is Really Upon Us’
Economist Stephanie Pomboy discussed the future of the U.S. dollar in an interview with Tucker Carlson last week. Pomboy is a financial analyst, market strategist, and economist, who founded Macromavens, a research firm specializing in emerging global economic trends. Before launching her firm, she worked as a managing director at an independent economic research firm ISI Group from 1991 to 2002.
“Here, in the U.S., policymakers still have their blinders on, and they imagine that the U.S. dollar will never be challenged as the world’s reserve currency, and that we can continue to print money … indefinitely,” she began.
The economist explained that in reality, a growing number of countries are moving away from the U.S. dollar. “They are not buying Treasury bonds anymore and they are diversifying [away from] our dollar into gold, into oil, and strategic resources,” Pomboy detailed. “And they’re starting to trade in local currencies. They don’t have to transact in dollars.” She stressed:
The demise of the U.S. hegemony is really upon us, and the Biden administration and so many in Washington are just sleeping right through it.
An increasing number of countries are shifting away from the U.S. dollar, opting for trade in their national currencies. Notably, the BRICS nations (Brazil, Russia, India, China, and South Africa) have advocated for the use of local currencies. Six additional countries, namely Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates, have received invitations to join the BRICS. The economic bloc has also explored the possibility of creating a common currency. Sergey Lavrov, Russia’s foreign affairs minister, recently stated that approximately “30 countries would like to establish partner ties with BRICS.”
Multiple people have similarly warned of the U.S. dollar losing its world reserve currency status. Rich Dad Poor Dad author Robert Kiyosaki has repeatedly cautioned about the end of the USD. Economist Peter Schiff has said many times that the U.S. dollar is near a historic crash. Renowned investor Jim Rogers has warned of the dollar’s dominance ending, seeing the Chinese yuan as a USD competitor.
Do you agree with economist Stephanie Pomboy about the demise of the U.S. dollar? Let us know in the comments section below.
Adrian Day Warns of ‘Inevitable’ US Recession, Describes it as a ‘Freight Train Heading Towards Us’
In a recent interview, Adrian Day, CEO of Adrian Day Asset Management, shared his insights, positing a looming economic downturn in the U.S. Day critically analyzed the Federal Reserve’s actions, explaining their expected impacts on the nation’s economy.
Adrian Day: Recession Looms Like an Oncoming Train
On November 8, 2023, Adrian Day the founder and CEO of Adrian Day Asset Management spoke with Michelle Makori, the lead anchor and editor-in-chief at Kitco News at the New Orleans Investment Conference 2023. During the interview, Day voiced concerns about the U.S. economy’s trajectory towards recession, deeming it “inevitable” due to the delayed repercussions of monetary policy tightening.
He noted the historical sequence where recessions ensue rate hiking cycles, highlighting that the average delay from rate hikes’ commencement to recession onset spans approximately 22 months. This perspective indicates that the U.S. might not yet have fully grappled with the Federal Reserve’s measures, suggesting an impending recession.
“A recession is inevitable in my view,” Day said. “It’s all but inevitable, it’s built-in and a lot of people think, well you know the Fed’s done all is dramatic hiking and we haven’t had a recession yet, therefore we’ve escaped it — I think they’re living in fantasy land.
Day critiqued the Federal Reserve’s strategy, arguing missed opportunities in rate adjustments, potentially complicating future economic scenarios. He underscored the uncertainty shrouding forthcoming rate hikes, emphasizing that prolonged high rates would significantly affect households and corporations. Day’s stance implies a ‘tighter for longer’ approach by the Fed, likely leading to more severe economic consequences.
Addressing inflation, Day forecasted a resurgence, attributing it to base effects and escalating oil prices. He contended that, even if the Fed curbs inflation, the implemented measures might intensify a recession. Day’s commentary mirrors skepticism about the Federal Reserve’s capacity to ensure a smooth economic transition, suggesting that either persistent inflation or aggressive rate hikes could precipitate economic difficulties.
Regarding investment strategies amidst these uncertainties, Day recommended diversifying portfolios and focusing on assets like gold and gold stocks, which he perceives as undervalued. “The outlook for gold is strong,” Day told Makori. “So gold stocks are very undervalued, but I think we’re approaching a time when we’re going to start seeing gold stocks attract buyers if the stock market starts to falter, not crash, but falter we’re going to see a rotation into … sectors that are undervalued.”
He also advised allocating a substantial portion of assets into cash or short-term treasuries, citing their current appealing returns. This strategy, Day suggests, equips investors to capitalize on potential market shifts stemming from the evolving economic landscape. “I think a recession is coming, it’s a freight train heading towards us, it just hasn’t hit us yet … it’s inevitable because of the lagging effects of the tightening,” Day told Makori.
What do you think about Day’s projections about specific assets and the state of the U.S. economy? Do you think a recession is inevitable? Share your thoughts and opinions about this subject in the comments section below.
Sega Exec Shuji Utsumi: ‘Blockchain Gaming Is Still an Unknown World for Us’
In a recent interview, Sega co-COO Shuji Utsumi talked about the company’s stance on blockchain games. For Utsumi, this new gaming field is still uncertain, and Sega is prepared to protect its franchises and learn about how these new games are being made via its partnership with Double Jump Tokyo, a blockchain games company.
Sega Still Considers Blockchain Gaming an ‘Unknown World’
Sega co-COO Shuji Utsumi has stated that, for the company, the blockchain gaming field is still unknown. In a recent interview, the executive explained the stance of Sega regarding blockchain games due to the upcoming release of Sangokushi Taisen, a game being licensed by the company and developed by Double Jump Tokyo, a blockchain gaming company and non-fungible token (NFT) solutions provider.
When asked about his thoughts on blockchain gaming, Utsumi stated:
Blockchain gaming is still an unknown world for us, so we want to protect what needs to be protected and take a new look at what needs to be captured in a new way.
This opinion is consistent with Utsumi’s earlier statements, in which he declared that play-to-earn games were “boring” and that the company would change its blockchain strategy, pulling the plug on in-house projects developed with this technology and protecting AAA franchises.
However, at that time, he acknowledged that lesser-known franchises could be licensed to third parties, including Sangokushi Taisen, considered an “IP that would be accepted by fans in Japan and other Asian countries and would harmonize effectively with blockchain technology.”
Transitional Period
Utsumi emphasized a need to engage and appeal to users with blockchain-based content designed to serve as an entry point for this gaming field, just like puzzle games for the mobile gaming industry.
He declared:
Within blockchain games, owning assets and, in some cases, earning money, could become player wants that haven’t existed before. In this regard, this is indeed a transitional phase for the industry.
Also, as one of the hurdles of blockchain gaming, Utsumi mentioned setting up wallets, stressing that games should allow users to set these up later in the game.
Despite Sega’s posture, blockchain gaming has continued to gather interest. Blockchain gaming projects have gotten investments for 0 million during Q3, according to Dappradar’s Third Quarter Blockchain Gaming report. Also, by Dapprardar’s numbers, companies have invested .3 billion in these initiatives in 2023.
What do you think about Sega’s stance on blockchain games? Tell us in the comments section below.
Renowned Investor Jim Rogers Warns ‘US Is Going to Suffer’ as Dollar’s Value Erodes Further
Veteran investor Jim Rogers, who co-founded the Quantum Fund with billionaire investor George Soros, has warned that “the worst is yet to come” for the U.S. economy. “The U.S. is going to suffer” as the value of the dollar erodes further, he predicted, emphasizing that inflation and the debt problems are going to get worse.
Jim Rogers Says ‘the Worst Is yet to Come’
Veteran investor Jim Rogers issued several warnings about the U.S. economy on Sputnik’s New Rules podcast, published last week. Rogers is George Soros’ former business partner who co-founded the Quantum Fund and Soros Fund Management.
“The worst is yet to come,” the renowned investor warned. “It always comes later after normal fluctuations and corrections.” Rogers explained: “We have printed a lot of money, we have borrowed and spent a lot of money, which is wonderful for the short term, but eventually we have to pay the price.” He cautioned:
Inflation is going to get worse. The debt problems are going to get worse, and the U.S. is going to suffer.
Drawing a comparison between the present circumstances and the 1980s, a period marked by significant inflation, he stressed, “The inflation now is worse,” noting that the U.S. is now the “largest debtor nation in the history of the world.”
While stating that “things are okay at the moment,” Rogers noted that it won’t last forever. “Somebody has got to pay this debt. Somebody has to print more money. Somebody has to borrow more money. And when you borrow huge amounts of money, interest rates will go higher and higher, inflation will go higher because so much money has been printed,” he detailed, emphasizing:
The value of the U.S. dollar will lose more and more value as [the U.S.] prints more. It always happens this way.
Using the British Empire as an example, Rogers highlighted that during the 1920s, Britain held the position as the wealthiest and most influential nation globally, surpassing all others. However, five decades later, the country found itself in a dire financial state, to the extent that the International Monetary Fund (IMF) had to intervene.
“That will happen to the U.S.,” Rogers predicted, clarifying that “It won’t happen this year, but it will happen.”
Last month, U.S. Treasury Secretary Janet Yellen defended the dominance of the U.S. dollar, arguing that the USD is used widely in trade because the U.S. has “deep, liquid, open capital markets, rule of law, and long and deep financial instruments.” However, she acknowledged in April that over time, the use of financial sanctions “could undermine the hegemony of the dollar.” She also said earlier this month that the ongoing trend of countries seeking to establish an alternative reserve currency to rival the U.S. dollar “is something that we simply have to expect.” Nonetheless, she emphasized that no country is able to replicate the USD, including China.
While concurring with Yellen, Rogers pointed out that the treasury secretary left out the fact that the U.S. is “the largest debtor in history and the debt is skyrocketing and the money printing is skyrocketing.”
He cautioned: “Eventually we have to pay the price. Every country in history has had to pay the price. Yes, she will print huge amounts of money. She will borrow and spend huge amounts of money, and they will think they are okay for a while, just as they have for other countries in the past. But, unless something has changed in world history and in world economics, this will not go on forever.”
Commenting on U.S. dollar alternatives, the famous investor said, “I don’t see anything on the horizon yet,” adding:
That may cause a big problem if and when things really go wrong with the U.S. and with the U.S. dollar, the world will have a serious financial crisis for a while anyway, unless we can bond something else.
“It is extremely important, especially when a crisis comes, that you have your money in a place that you yourself understand a lot about,” he concluded.
Rogers has repeatedly warned about the worst bear market in his lifetime, stating that investors should be worried. He said in May that the U.S. dollar’s time is coming to an end as a growing number of nations worldwide seek to de-dollarize.
Others have similarly sounded the alarm about inflation, the debt crisis, and the demise of the U.S. dollar, including economist Peter Schiff and Rich Dad Poor Dad author Robert Kiyosaki. Schiff said in June that the U.S. dollar decline will be “far greater” than what Yellen described, noting that Federal Reserve Chairman Jerome Powell is “clearly worried” about a financial crisis. He also warned of a U.S. dollar crisis, predicting that national debt will “spiral out of control.”
Do you agree with Jim Rogers? Let us know in the comments section below.
Circle CEO Jeremy Allaire: ‘Other Governments Are Regulating Digital Dollars Before the US’
Jeremy Allaire, CEO of Circle, the company behind the issuance of usd coin (USDC), has expressed his worries about the state of stablecoin regulation in the U.S. In a congressional hearing, Allaire stated that other governments were already regulating the issuance of digital dollars (dollar-backed stablecoins) and called on the U.S. government to act by issuing stablecoin rules.
Circle CEO Jeremy Allaire Calls for Stablecoin Regulation: ‘It’s Time to Act.’
Jeremy Allaire, CEO of Circle, a U.S.-based stablecoin company, has called for stablecoin regulation to preserve the country’s sovereignty over the issuance of digital dollars. In a congressional hearing, Allaire explained that other countries have already drafted and established frameworks for issuing dollar-backed stablecoins, leaving the U.S. behind.
Allaire explained:
We are seeing governments around the world — the EU, the U.K., Japan, Hong Kong, Singapore, and others — actually defining the rules for how dollars, digital dollars, are issued and operate in those markets, which is astounding.
Furthermore, Allaire detailed how the lack of regulation could have “devastating consequences” for the competitiveness of the U.S. dollar in a world driven by digital interactions on the internet. Allaire recently reiterated his call to action on social media, stating: “It’s time to act.”
How Commercial Banking Affected USD Coin
Circle is the company behind usd coin (USDC), the second largest stablecoin in the crypto market, with a market cap of .3 billion. The token suffered a depegging incident in March due to the demise of Silicon Valley Bank (SVB), which held 8.8% — about .3 billion — of the total reserve backing the USDC stablecoin.
The depeg, which took the price of usd coin as low as .85, was reverted with the announcement that all the depositors of SVB would be made whole. At the time, Allaire remarked on the importance of establishing clear rules to avoid this from happening again, advocating for “full-reserve digital currency banking that insulates our base layer of internet money and payment systems from fractional reserve banking risk.”
Stablecoins have risen as a significant part of the cryptocurrency market, with a notable jump in their utilization. According to Kaiko, a cryptocurrency market data provider, the utilization of stablecoins has risen to 76% of all cryptocurrency transactions. This represents a 16% increase since the beginning of 2022.
A new stablecoin legislation draft was released by House Financial Services Committee Chair Patrick McHenry on June 8.
What do you think about Jeremy Allaire’s calls for stablecoin regulation? Tell us in the comments section below.
Russian State Duma Chairman: ‘US National Debt Is a Global Financial Pyramid’
Vyacheslav Volodin, chairman of the Russian State Duma, the lower house of the Russian Federal Assembly, has stated that U.S. debt has become a “global financial pyramid” whose objective is to “deceive other nations and people.” Volodin also explained that the ability of the U.S. government to service its debt was weakening, making the U.S. dollar a toxic currency.
Russian State Duma Chairman Criticizes U.S. Debt Management
Vyacheslav Volodin, chairman of the Russian State Duma, has blasted the U.S. government’s management of its national debt. On Friday, the head of the lower house of the Russian Federal Assembly criticized the situation of the spiraling debt of the U.S. and how the U.S. government has lifted the debt ceiling more than 100 times in the past.
On his Telegram channel, Volodin stated:
All financial pyramids, as history shows, sooner or later end in failure. But the current situation is different. The U.S. national debt is a global financial pyramid created by Washington to deceive other nations and people.
Furthermore, Volodin explained that the ability of the U.S. government to service its debt was weakening. This made the dollar a risky coin to hold, Volodin remarked, making it a “toxic” currency, explaining that several countries were shifting to other currencies for this cause.
U.S. Debt in Perspective
According to official numbers, for the year 2023, the U.S. debt was .4 trillion, having increased almost trillion during the last five years. A significant yearly increase was produced in 2020 when it rose 19% due to the impact of the different Covid-19 assistance programs.
The increase in this national debt also determines a rise in the interest paid on it. On this, Volodin stated:
Just think about it, in 2023 the sum of interest payments on the U.S. national debt could reach 1.5 trillion USD, and it is almost a third of all US budget revenues.
The Chairman of the State Duma also recommended that the different states of the U.S. federation should seek alternatives to the dollar to reduce the risks for their citizens.
Twenty-three states are discussing laws to approve using gold and silver for payments. In April, Arkansas signed a law to make gold and silver bullion and coins legal tender, releasing transactions made with these metals from any tax duties. In the same way, Texas is currently advancing a bill that would issue a gold-backed digital currency as legal tender.
What do you think about the statements of Vyacheslav Volodin, chairman of the Russian State Duma, on the U.S. national debt and the U.S. dollar? Tell us in the comment section below.
Federal Reserve Raises Interest Rate by 25bps, Insists ‘US Banking System Is Sound and Resilient’
The U.S. Federal Reserve, in conjunction with the Federal Open Market Committee (FOMC), announced on Wednesday that the central bank would raise the federal funds rate by 25 basis points (bps), as was widely expected by the market. This marks the tenth consecutive occasion in which the Fed has raised interest rates since the initial 25bps increase in March 2022.
FOMC Announcement Says ‘Additional Policy Firming May Be Appropriate’
At 2:00 p.m. Eastern Time, the central bank raised the benchmark interest rate citing that economic activity expanded “at a modest pace in the first quarter.” The Fed’s announcement noted that unemployment has been low but “inflation remains elevated.” The FOMC announcement further addressed the issues in the U.S. banking industry and the committee emphasized that the “U.S. banking system is sound and resilient.”
The Fed’s unbroken chain of rate hikes is a testament to the bank’s unwavering commitment to getting inflation down. The FOMC’s press release notes a priority to get the inflation rate down to the 2% range. “In support of these goals, the committee decided to raise the target range for the federal funds rate to 5 to 5-1/4 percent,” the FOMC said on Wednesday.
The news caused all four major U.S. benchmark stock indexes to jump, alongside a modest spike in precious metals and crypto markets. However, investors at the time were still waiting to hear what Fed chairman Jerome Powell had to say concerning rates going forward. It’s been speculated that the Fed will stop its rate hikes for the rest of the calendar year.
While some market observers expect the central bank to pivot and cut the benchmark bank rate, the FOMC said the committee still anticipates that some “additional policy firming may be appropriate to return inflation to 2 percent over time.” The FOMC message does not explain whether or not the Fed will keep the rate the same at the meeting in June.
During the press conference, Powell addressed the U.S. debt limit and expressed hope that a resolution would be reached. Consistent with his previous statements, the Fed believes that failure to raise the debt limit could lead to financial disruption. As for the Fed’s next move, Powell stated that the central bank is “prepared to do more if greater monetary policy is warranted.”
What do you think the Federal Reserve’s decision to raise interest rates means for the U.S. economy? Share your thoughts and opinions in the comments section below.
Crypto Tidbits: Bitcoin Slides Under $10,000, JP Morgan & Ethereum, and the US’ Cryptocurrency Crackdown
Another week, another round of Crypto Tidbits. If you look at the below chart, it may seem like Bitcoin had a subdued week in terms of price action; however, the past few days for this budding market has been filled with ups and downs, like the surge to ,600, then the subsequent strong retracement to ,700 on Saturday morning as bulls failed to keep up the pressure.
Whatever the case, BTC ends the past seven days up a mere 0.33%. Though, Bitcoin’s non-performance on the week is abnormal, with altcoins such as XRP and Ethereum exhibiting massive gains of over 10%, despite the relative stagnation in the cryptocurrency market’s leader.
This trend has resulted in Bitcoin dominance tanking by a handful of percent — a trend actually impressive for a market worth hundreds of billions.
Aside from the market, the underlying cryptocurrency industry saw a relatively productive week, with there being a number of news stories showing the growth and adoption of these technologies, though others casting light on issues in crypto.
Related Reading: Crypto Tidbits: Bitcoin Nears ,000, Tron CEO’s Warren Buffett Rendezvous, Ethereum DeFi Hits B
Bitcoin & Crypto Tidbits
Pro-Bitcoin Presidential Candidate Andrew Yang Leaves Race: If you’ve been on Twitter over the past few months, you’ve likely heard the name Andrew Yang mentioned many a time. Yang is a businessman-turned-presidential candidate who decided to try and leverage his experience creating jobs and building companies, joining the race to become the President of the United States. A key part of his campaign has been technology, and unsurprisingly, Bitcoin and blockchain have been mentioned. Yang has expressed his support for the technology, on one occasion posting a photo of him and Litecoin’s Charlie Lee, and on other occasions mentioning how he believes blockchain and cryptocurrency are a positive technological class for the future. Unfortunately for Bitcoin bulls optimistic about a Yang presidency (which would likely be marked by better crypto regulation), the candidate dropped out of the race over the past week after a poor showing in a Democratic primary.
JP Morgan May Dip Toes Into Ethereum, Again: This week, Reuters reported that one of the world’s largest financial institutions, JP Morgan, is looking to merge its blockchain unit called “Quorum” with the New York-based Ethereum development studio ConsenSys. On why this is bullish for ETH, market commentator Satoshi Flipper said:
“So why is this so bullish for ETH? Because cash is king and JPMorgan has much of it. With the pending release of 2.0, JPMorgan could desire an increased presence in the enterprise blockchain arena. And Ethereum is a quick ticket to get there,” he explained while referencing the news report.
Treasury Secretary Confirms Crypto Crackdown: Last year, after Libra launched, Steven Mnuchin, the Secretary of the U.S. Treasury, said that cryptocurrencies pose a “risk to the financial system” and are a “national security issue.” It seems that Mnuchin has begun to respond to the rising threat. Speaking during a hearing held by the Senate Finance Committee, Munchin said that the Financial Crimes Enforcement Network (FinCEN) branch of the Treasury will soon roll out “significant new requirements” for cryptocurrencies and the respective providers of Bitcoin trading and so on and so forth. He did not expand on these comments, though a recent budget proposal from the White House indicated that a crackdown is coming regarding crypto’s use in money laundering and terrorist financing.
Federal Reserve Working on Digital Currency… Finally: In Tuesday’s meeting of the House of Representatives Committee on Financial Services, Powell said that the central bank for America has started to really get to work on digital currency efforts:
We’re working hard on it, we have a lot of projects going on, lot of efforts going on on that right now.
CNBC Anchors Show Interest In Bitcoin: This week, the anchors of CNBC’s “Fast Money” show showed optimism towards the prospects of Bitcoin. Host Timothy Seymour, CIO of Seymour Asset Management, argued that Bitcoin’s recent uptrend is a result of developments in institutional involvement in the cryptocurrency space. Another anchor on the panel said a world where central banks are devaluing their money to keep the economy “healthy” is a world where Bitcoin “wins”:
In a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. In a world of fiat currencies, Bitcoin is the victor.
Featured Image from Shutterstock
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Venezuelan President Announces Oil-Backed Cryptocurrency “Petro” to Combat ‘US Blockade’
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