The BRICS summit is currently taking place in South Africa, and the member countries of Brazil, Russia, India, China, and South Africa have announced their intention to prioritize de-dollarization. This means that they are seeking ways to reduce their reliance on the U.S. Dollar as a reserve currency and for international trade settlements. The bloc is actively working on establishing a new payment system and potentially a new currency backed by gold.
One of the key achievements of the BRICS bloc in this regard is the completion of bilateral trades in local currencies. For example, China and Russia have been settling their trades in their respective currencies, signaling their interest in weakening the U.S. Dollar. India has also successfully bought crude oil from the UAE, paying in Indian Rupees. These actions by the BRICS members are indications of their intention to move away from the dominance of the dollar in international trade.
Moreover, the BRICS bank, also known as the New Development Bank (NDB), is planning to issue its first Indian Rupee Bond by October. The bank aims to raise and lend more in local currencies, increasing its presence in the local capital markets of its member countries. This move aligns with the bloc’s objective of de-dollarization and takes them one step closer to achieving it.
In addition, there have been rumors that the Organization of the Petroleum Exporting Countries (OPEC) members are considering selling their oil in currencies other than the U.S. Dollar. Although the UAE admits that this cannot be changed overnight, it suggests a potential shift away from the dollar in the future.
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Furthermore, the BRICS bloc has expanded its membership by including five new countries: UAE, Egypt, Ethiopia, Saudi Arabia, and Argentina. This expansion reflects the bloc’s ambition to challenge the dominance of the West and create a power shift in the world. While it remains unclear how these new members will contribute to the bloc’s stance on digital assets, there is optimism within the crypto community that the alliance will embrace new technologies, such as Ripple’s XRP and Bitcoin, to facilitate international trade and launch Central Bank Digital Currencies (CBDCs) using blockchain technology.
The utilization of cutting-edge technology offered by projects like Ripple, Ethereum, and Cardano could drive mass adoption of digital assets and lead to new all-time highs in cryptocurrency prices in the long term. However, it is important to note that the BRICS summit did not specifically address digital assets or their role in the new financial system being established by the bloc.
In conclusion, the ongoing BRICS summit highlights the coalition’s commitment to de-dollarization and its efforts to reduce reliance on the U.S. Dollar. The bloc is exploring the establishment of a new payment system and potentially a new currency backed by gold. Bilateral trades in local currencies, the issuance of local currency bonds by the BRICS bank, and the potential shift in oil trade away from the dollar signal progress towards de-dollarization. The inclusion of new member countries further strengthens the bloc’s ambition to challenge the Western dominance. While the stance on digital assets remains uncertain, there is hope within the crypto community that the alliance will embrace new technologies to drive mass adoption and potentially contribute to the rise in cryptocurrency prices.
