Bitcoin
How BTC Profits as US-Saudi Petrodollar Deal Ends
Bitcoin (BTC) will benefit from the end of the US-Saudi petrodollar deal. Furthermore, the financial world is poised for a seismic shift in the wake Saudi Arabiathe decision not to renew its long-standing security agreement with the United States, which expired on June 9, 2024.
This crucial move allows Saudi Arabia to sell oil and other goods in multiple currencies. These include Chinese RMB, Euros, Yen and Yuan, rather than exclusively in US Dollars. Additionally, the use of digital currencies such as Bitcoin could also be explored.
End of the agreement between the US and Saudi Arabia on the petrodollar
The latest development marks a significant departure from the petrodollar system established in 1972, when the US decoupled its currency from gold. Furthermore, the decision is expected to accelerate the global trend away from the US dollar, with Bitcoin standing to gain significantly from this change.
Saudi Arabia has announced its participation in the China-dominated cross-border central bank digital currency (CBDC) trial, Project mBridge. The measure underlines its commitment to diversifying its economic dependencies. The Bank for International Settlements (BIS) announced Saudi Arabia’s full participation in the mBridge Project.
The project includes central banks from China, Hong Kong, Thailand and the United Arab Emirates. According to Reuters, Josh Lipsky of the Atlantic Council noted: “The most advanced cross-border CBDC project has just added a major G20 economy and the world’s largest oil exporter.”
The mBridge platform, now in the “minimum viable product” phase, aims to facilitate cross-border transactions using CBDCs. Furthermore, the platform is compatible with Ethereum Virtual Machine, the backbone of the Ether cryptocurrency network. This opens up new avenues for digital currency transactions.
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How will Bitcoin benefit from this development?
In a post on X, Doctor Profit, a well-known crypto analyst, wrote: “US-Saudi petrodollar deal ends and will not be extended. This will force the US to print tons of new dollars!” The anticipated increase in US dollar printing is expected to lead to increased inflation.
As inflation increases, the value of fiat currencies such as the US dollar tends to decrease. Furthermore, it would lead investors to seek refuge in alternative assets. Bitcoin, with its fixed supply and decentralized nature, positions itself as the main beneficiary of this change.
Furthermore, the analyst predicts an upward trend for Bitcoin. He stated: “From today onwards, the dollar will come under severe pressure, the dollar will be printed, inflation will begin to rise. Bullish for gold, Bitcoin, stocks and real estate.” The short-term economic turmoil expected from this transition may be frightening, but the long-term outlook for Bitcoin is promising.
A concerned user pointed out that ordinary people will not invest in Bitcoin, gold or other assets when inflation rises. Doctor Profit responded: “Do you think the market needs ordinary people to move? It’s more of a long-term increase. The effects of this change will be seen 8 to 12 months from today.”
Bitcoin’s role as protection against inflation becomes more pronounced as traditional financial systems face instability. Furthermore, Bitcoin’s decentralized and deflationary attributes make it an attractive store of value. Bitcoin also offers protection against the devaluation of fiat currencies.
Doctor Profit further noted: “Soon the US will realize that it cannot defeat inflation. They will manipulate the masses as they did when they recently manipulated the inflation basket. They will make it look like inflation has been defeated, to justify printing new money. Their goal is clear: TURN ON THE PRINTERS!!
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