With the continuous evolution of bitcoin, many people seem to begin to think about who is using bitcoin

Peter Thiel's speech at the Richard Nixon foundation event further pushed cryptocurrency to the geopolitical stage. He believed that bitcoin is China's financial weapon against the United States and poses a huge threat to the US dollar.

It seems that Peter Thiel really reminds the regulators to supervise bitcoin and prevent bitcoin from posing a greater threat to the international status of the US dollar. On the other hand, he also reminds the public that bitcoin may have a greater role or significance than it seems.

As early as 2013, Peter Thiel talked about the potential of bitcoin to "change the world" and on other occasions praised the function of bitcoin as a reserve asset. Bitcoin's stable supply and global coverage may one day make it compete with the US dollar for the position of world reserve currency.

Peter Thiel has access to the top talents in the encryption industry through some of his investments. He admits that bitcoin is not an excellent payment system, and he definitely realizes that the US dollar is still the most powerful reserve currency at present. It is precisely because the world is trading based on the US dollar system, and the US dollar is an effective currency all over the world.

Let bitcoin become a "weapon"

He also believes that China may support bitcoin to a certain extent, and is "cultivating bitcoin" and "weaponizing bitcoin", using bitcoin to weaken the US dollar. But in fact, China is not friendly to bitcoin. In addition to the ban on cryptocurrency exchanges for many years, a large number of mines in Inner Mongolia were closed last month. Given the domestic struggle against capital flight, domestic regulators are more likely to want bitcoin to disappear. Moreover, if China really wants to weaken the US dollar, promoting the internationalization of the RMB is a more effective way.

Peter Thiel's comments on bitcoin are likely to get US regulators to start taking bitcoin more seriously. But he also saw a broader threat from China to American dominance.

Many worry that if the US starts to see bitcoin as a threat, it is likely to ban it directly. But this is unlikely to happen, because the United States has been concerned about the social unrest caused by countries such as Nigeria trying to limit the domestic circulation of cryptocurrency. In addition, the U.S. ban on bitcoin will be the best advertisement for bitcoin. Once the U.S. ban on bitcoin, it means that some groups or countries need something like bitcoin, and its worldwide influence may weaken the soft power of the U.S. dollar.

However, it is more likely that the supervision of bitcoin in the United States is more about the investment in encryption infrastructure, such as some financial derivatives, the use of cryptocurrency infrastructure, which will have an impact on the entire encryption industry. This includes reassuring institutional investors about the concept, which may even remove the last hurdle to the SEC's approval of bitcoin ETFs.

The United States now seems to recognize this opportunity for infrastructure development and is doing so.

(2021-4-12)