Great powers often pursue their interests with strategies that involve economic coercion or competition.
Bitcoin will force them to completely alter these strategies. And this will be good for the world.
Economic sanctions are the classic way in which great powers try to submit other nations to their interests. Especially if they have control over the financial system, like the US currently has.
This explains why the US is the leader in sanctions with 9,000 imposed as of 2023. Its control over the global financial system through the USD allows it to create serious headaches to any entity using dollars for trade.
Bitcoin will force great powers to adopt a totally different strategy because no great power (or small power) can control it or decide who can or cannot use it.
It will be impossible for great powers to cut their adversaries out of world trade with the push of a button. Instead they will have to revert back to competition to gain an advantage over competitors and adversaries.
The most viable strategy to gain an advantage is by attracting as much hash rate as possible to its or friendly jurisdictions.
By doing so they will earn Bitcoin fees on as many Bitcoin transactions worldwide as possible. In theory they could then push their adversaries’ Bitcoin transactions to hash rate in other jurisdictions. This should put upwards pressure on the transaction fees of those adversaries.
In order to attract as much hash rate as possible great countries will need to develop their technology and energies sectors.
This competition in tech and energy will be good for the world, which will benefit greatly from the second and third order effects of these (peaceful!) developments.
quotingBitcoin: the answer to Russia’s payment and China’s sanctions problem
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Russian companies have encountered payment issues in their transactions with Chinese partners. Chinese banks are stricter towards transactions with Russia after threats of secondary sanctions from the US.
Bitcoin would allow China to continue trade with Russia unabated while making threats of sanctions look silly and pathetic. And causing an economic boom while they are at it!
The US has always been the defender of free flow of information, trade and transactions. China declaring that it is a universal right to trade and transact freely, will make US threats of sanctions look silly and pathetic.
By allowing Bitcoin (and stablecoins on Bitcoin infrastructure) tens of thousands of entities in China would be transacting with tens of thousands of entities in Russia. Nobody will be able to stop it.
The US won’t be able to interfere and neither will the Chinese government. It provides the perfect excuse to continue trade with Russia. While at the same time providing the world with an alternative to the ever tightening grip of western governments on trade and their economies.
Sanctioning China for the free flow of goods, services and money will make the US look like a hypocrite in the eyes of the world. Besides, China will experience an economic boom that will catapult it to be the #1 economy on the globe. In a very short time frame…
It will require the Chinese government to relinquish its perception of control, which probably won’t come easy to it. Luckily El Salvador provides an example.
El Salvador and Bukele show that economic freedom alters the contract between government and citizens without the government losing legitimacy.
On the contrary, El Salvador’s government and Bukele in particular have only become more popular by providing their citizens with better lives through economic freedom.
