Amid escalating economic friction between the United States and China, insights from recent financial expert discussions highlight Bitcoin’s emerging role as a potentially crucial strategic asset. The ongoing trade disputes could be setting the stage for a new kind of global competition centered on cryptocurrency.
Financial strategist Zoltan Pozsar, founder of Ex Uno Plures, recently analyzed the dynamic, suggesting China faces significant economic headwinds. Its export-heavy model is vulnerable to U.S. tariffs, complicating efforts to manage substantial national debt.
Pozsar noted that while tariffs might pressure China significantly, Western consumers might simply adapt by reducing purchases. He also observed a fascinating strategic shift: the U.S. adopting more state-led industrial funding, resembling past Chinese tactics, while China experiments with direct monetary easing, a more Western approach.
This global economic realignment, according to Pozsar, strengthens the case for non-traditional assets. He contrasted the US and Chinese approaches with European strategies potentially overly focused on central bank support, suggesting a broader strategic confusion that could benefit decentralized systems like Bitcoin (BTC).
Building on this, Dan Morehead, head of Pantera Capital, anticipates the dawn of a “strategic Bitcoin gap.” With the U.S. government already possessing a notable portion of the global Bitcoin supply (estimated around 1%), Morehead argues that accumulating more BTC would be a logical next step, akin to its historical gold reserve strategy.
Morehead predicts this could prompt other nations, particularly those wary of the U.S.-dominated financial system, to initiate their own national Bitcoin accumulation programs. This competitive hoarding could create significant demand pressure on the limited Bitcoin supply.
Even nations historically skeptical of cryptocurrencies, like China, might reconsider. Despite its anti-crypto stance, China holds significant digital asset reserves acquired through seizures. The allure of gaining a strategic edge over the U.S. could potentially influence its future policy regarding a national Bitcoin reserve.
Recent findings, such as a VanEck report, lend credence to this shift. The report indicated instances of China and Russia utilizing Bitcoin for settling certain energy transactions, potentially as a means to circumvent the U.S. dollar’s dominance in international trade and explore alternatives. This trend underscores the growing consideration of digital assets in global power dynamics.