As the global economy becomes increasingly digitized, the geopolitical battle for economic and military dominance is shifting in profound ways. The United States, leveraging its dollar supremacy, technological innovation, and financial infrastructure, is poised to consolidate its position as the world’s preeminent power. Meanwhile, China—America’s primary rival on the global stage—faces a precarious future if it does not urgently adopt a bold strategy: embracing Bitcoin as a reserve asset to safeguard its currency and maintain relevance in the digital economy.
Here’s why Bitcoin could be China’s last, best hope.
The Looming Crisis for the Chinese Yuan
The Chinese yuan, despite being the currency of the world’s second-largest economy, is fundamentally disadvantaged in the global financial system. Unlike the U.S. dollar, which enjoys reserve currency status and is used in the majority of international transactions, the yuan has limited global acceptance. China’s currency is tightly controlled by the government, which undermines trust in its long-term stability.
Compounding this challenge is the rise of U.S. dollar-backed stablecoins as the de facto digital currency of choice. These stablecoins—such as USDC and USDT—are becoming increasingly integral to global commerce, particularly in emerging markets where mobile phones and digital wallets are leapfrogging traditional banking systems. If dollar-backed stablecoins dominate global trade, the yuan risks becoming irrelevant in the digital age.
Worse still, should Bitcoin emerge as the world’s ultimate store of value—a scenario many argue is inevitable—China’s reliance on a fiat currency backed by neither Bitcoin nor significant reserves of gold could leave it vulnerable to hyperinflation. A yuan without Bitcoin backing could lose credibility entirely, especially if global confidence in gold’s role as a reserve asset diminishes due to its lack of digital utility and unverifiable supply.
The American Empire’s Growing Advantage
The United States is uniquely positioned to dominate the next phase of economic evolution. By already amassing substantial Bitcoin reserves (both directly and indirectly through its citizens and corporations), the U.S. is quietly preparing for a future where Bitcoin plays a central role in global finance. Moreover, the U.S. dollar’s dominance is being reinforced by stablecoins, which effectively act as an extension of American monetary policy in the digital realm.
If this trajectory continues, the American empire will enjoy a financial system backed by both Bitcoin and dollar-pegged digital currencies. This dual strength would make it nearly impossible for any rival—including China—to challenge U.S. hegemony. China risks being left behind in a world where economic power hinges on control of scarce, verifiable, and digital-first assets.
Why Bitcoin Is China’s Best Option
China’s only viable path to countering the United States’ dominance is to embrace Bitcoin as a strategic reserve asset. Here’s why:
- Scarcity and Verifiability: Unlike gold, whose supply and location can never be mathematically verified, Bitcoin is finite, with only 21 million coins ever to exist. This scarcity, combined with its blockchain’s transparency, makes it the most trustable store of value in history. Accumulating Bitcoin would give China a reliable asset to back its currency.
- Digital Utility: Bitcoin’s decentralized nature and seamless integration into the digital economy make it far more relevant than gold in the 21st century. As global trade and finance become increasingly digital, Bitcoin’s role will only grow.
- Hedging Against U.S. Dominance: By acquiring Bitcoin, China could diversify its reserves away from reliance on the U.S. dollar. A Bitcoin-backed yuan would increase confidence in the currency and provide a counterbalance to dollar-backed stablecoins.
- Propping Up the Yuan: Holding significant Bitcoin reserves would allow China to peg the yuan to a valuable digital asset, stabilizing its value and preventing hyperinflation in a world where fiat currencies without Bitcoin backing could collapse.
The Risk of Inaction
Should China fail to act, the consequences could be catastrophic. If the yuan becomes worthless on the global stage, China’s economic and military power will collapse. A currency without trust or value is a nation without leverage. The American empire would cement its position as the only economy backed by anything of real value—Bitcoin and dollar-pegged digital currencies—leaving China as a marginalized power in a unipolar world.
Further, as gold’s relevance declines, nations that rely solely on it for reserve security will find themselves holding an asset with diminishing utility. In such a scenario, China’s significant gold reserves would do little to secure its economic future.
A Strategic Shift
China must move quickly to accumulate Bitcoin while it is still relatively undervalued. A coordinated effort to purchase and hold Bitcoin would not only protect the yuan but also provide a hedge against the growing dominance of U.S. dollar-backed assets.
Additionally, integrating Bitcoin into China’s financial system could give the yuan a competitive edge in the emerging global digital economy. This strategy would require a significant shift in Chinese policy, including reversing its current anti-crypto stance and fostering a domestic Bitcoin ecosystem to support adoption and innovation.
Conclusion
China’s future as a global superpower hinges on its ability to adapt to the new realities of the digital age. Bitcoin represents an unparalleled opportunity to secure its economic independence and maintain relevance in an increasingly multipolar world. The alternative—watching as the U.S. consolidates its dominance through Bitcoin and dollar-backed digital currencies—would be disastrous for China’s ambitions.
The clock is ticking. If China does not act now, it may find itself permanently out-maneuvered in the greatest financial revolution of our time.
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