When local currency collapses, companies in places like Venezuela must shift focus from core operations to creatively exporting anything possible (like salt or pallets) just to secure hard currency for essential imports like spare parts.
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The recent unrest originated with merchants in Tehran's Grand Bazaar, a group that prioritizes stability. Their protests highlight the crisis's economic roots: inability to access hard currency for imports, rampant inflation, and collapsing consumer demand, making business untenable for even multi-million dollar traders.
Modern global conflict is primarily economic, not kinetic. Nations now engage in strategic warfare through currency debasement, asset seizures, and manipulating capital flows. The objective is to inflict maximum financial damage on adversaries, making economic policy a primary weapon of war.
Russia has dramatically shifted its oil trade away from the U.S. dollar, with only 5% of exports now settled in USD, down from 55% in 2022. While this circumvents direct financial sanctions, Russia remains vulnerable as key logistics like freight and insurance are still dollar-linked, increasing costs and complexity.
Having lived through hyperinflation where money became a meaningless number, the real store of value is owning productive assets. A portfolio of quality businesses that provide real goods and services offers tangible protection that fiat currency cannot, as these businesses can adapt and reprice.
The primary, world-changing use case for stablecoins isn't cheaper domestic payments. It's providing global, frictionless access to the U.S. dollar. This allows citizens in countries with unstable currencies or untrustworthy central banks to opt-in to the U.S. financial system, effectively exporting America's most powerful product.
Resourceful Venezuelans tapped into private energy sources like small hydro plants to mine Bitcoin. This created a portable, non-governmental store of value they could carry on a digital wallet to flee the country and start a new life.
The US military action in Venezuela is viewed through the lens of the petrodollar system. It's seen as another instance of the U.S. aggressively targeting a nation that challenges the dollar's dominance by not denominating its oil exports in USD.
In Venezuela's crisis, the bolívar devalued so severely that its calorific value when burned for fuel exceeded its purchasing power. This illustrates the complete collapse of a currency's function as a store of value and medium of exchange.
The fall of the dollar as the world's reserve currency isn't an abstract economic event. It would have immediate, tangible consequences for citizens, including skyrocketing prices for imported goods like energy and medicine, a sharp drop in living standards, and an exodus of talent and capital to more stable regions.
As the "con game" of global fiat currency dilution becomes undeniable, a secular shift is underway. Capital is rotating out of traditional financial assets and into long-neglected hard assets like precious metals and crypto. This creates a structural short squeeze on sectors with tight supply, like gold miners.
