In a recent interview, Russian President Vladimir Putin claimed that the Biden administration’s policies are undermining the US dollar, which could accelerate the rise of alternative currencies like Bitcoin.
Speaking at an economic forum, Putin stated that the US dollar being armed in foreign policy has eroded confidence, leading countries to reduce dollar reserves. Transactions using the dollar and euro have plunged over 80% in Russia while using the Chinese yuan and ruble has climbed.
The dollar’s dominance faces other threats like the ballooning $34 trillion national debt. Federal Reserve Chair Jerome Powell called this debt level unsustainable, stoking doubts about the dollar.
Amidst the uncertainty, Bitcoin has rebounded in price and gained a grip as a potential dollar alternative. Former Ark CEO Cathie Wood points to Bitcoin’s surge during recent banking turmoil as evidence it is viewed as a flight to safety. Data also shows an inverse Bitcoin-dollar correlation, highlighting Bitcoin’s use to hedge dollar risks.
Bitcoin is positioned to fill the space with the dollar, possibly losing status. But whether it can evolve into a true global reserve currency remains to be seen.