The De-Dollarization Revolution

considerable weight to the de-dollarization movement. This move signifies a significant shift in the global balance of power and has the potential to challenge the long-standing dominance of the US dollar as the world's reserve currency. Approximately 85% of the world's population could potentially abandon the greenback. Just like a slow burn that suddenly reaches a tipping point and transforms into a blazing fire, the devaluation of the dollar and the trend of de-dollarization can experience a sudden and notable acceleration. This acceleration may occur due to a combination of economic, political, or systemic factors that amplify the movement away from the dollar, causing a decisive shift in global financial dynamics. The ongoing de-dollarization trend is not only gaining momentum but has also reached a point of irreversibility. The increasing number of transactions conducted outside the realm of the U.S. dollar holds great significance. It reduces the demand for the dollar and creates an environment where the value of the dollar must decline, leading to a need for higher interest rates as compensation. Saudi Arabia is a crucial player in the movement towards de-dollarization. The agreement made between the Nixon administration and Saudi Arabia in the 1970s, as mentioned by a source, involved the exclusive trading of oil in dollars by the Saudis in exchange for security assurances from the United States. As a result of this agreement, there was also a shift within OPEC to conduct oil transactions in dollars.This arrangement, which has been in place for nearly five decades, has contributed to the synthetic demand for the U.S. dollar. Consequently, the dollar has gained its petrodollar status. However, the recent actions taken by Saudi Arabia in relation to its currency should raise concerns about the position of the world's reserve currency.When Saudi Arabia begins accepting currencies other than the dollar for oil transactions, it will have significant repercussions, according to an unidentified source. To ensure the success of this movement, the source suggests the need for a commodity-backed currency, possibly tied to gold, and implemented through distributed ledger technology or blockchain. A recent development also worth noting is Saudi Arabia's decision to become a dialogue partner within the China-led Shanghai Cooperation Organization (SCO). Established in 2001, the SCO is a political, security, and trade alliance aimed at countering Western influence. Its membership comprises China, Russia, India, Pakistan, and four central Asian countries. They also are in talks to join BRICS BANK. It provides funding for infrastructure and sustainable funding projects in BRICS and other emerging economies, aiming to promote economic cooperation and sustainable growth.

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