Elon Musk took to X on March 13 to slam the dollar, while Russia announced a BRICS non-dollar denominated blockchain project for cross-border clearances.
In a series of posts on March 13 on X platform, Elon Musk disparaged the U.S. Dollar and predicted its demise. Musk cited overspending as well as the centralized nature of the currency as fundamental problems. It is not the first time that he has done so, but this time it comes out just when others who are in a position to create something different at the governmental level are talking about it.
Musk has been pointing to the problems with fiat currency for a long time. As the tongue-in-cheek CEO of Dogecoin for years, Musk got into trouble more than once for stepping across the line of decorum regarding investing advice.
Whether Musk seriously considers the dollar to be on its death bed or not, his statements are noted by a range of people from cryptocurrency enthusiasts to analysts. His view is definitely not positive, as he showed in April pointing to the ‘weaponization of the U.S. Dollar.”
BRICS mull circumventing SWIFT
While Musk is contemplating the demise of the dollar online, the BRICS alliance, especially China and Russia, have agreed on the formation of an international payments clearing system that would, in effect, replace SWIFT across member countries.
The blockchain-enabled system would enable payments internationally, Kremlin aide Yury Ushakov told the Russian news agency TASS. It would also enable member countries to conduct business while circumventing western financial sanctions.
Ushakov did not mention any timing for the roll-out of the payment processor, or even for any testing.
A Chinese Blockchain SWIFT
To compare, China has been testing its digital yuan for four years as well as laying out the dedicated hardware and fiber-optic lines to support a separate international payments system in blockchain form in South-East Asia since 2020. At the same time, the country has a well-developed cross-border system connected to SWIFT called China International Payment Service, which handles multiple currencies already.
The BRICS countries have a summit coming in Autumn 2024, and no doubt international clearances will be a component of those talks. With China sporting an economy eight times the size of Russia’s even before the broad-scale invasion and greater expertise in cross-border payments systems, the probability of China wanting to build out on its existing systems, but under its own terms, is quite high.
