🐻 Down goes the US dollar...up goes Bitcoin

Is the fall of the US dollar a win for Bitcoin?

Hey friends, welcome back to another issue of Web3 Seems Legit. Bitcoin just reached its 10-month high, but will it break its $30,000 resistance? There’s a lot happening this week that can either throw it off its course, or send it soaring. Let’s see!

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In this issue:

📣The big story of the week. The great de-dollarization is here. While the US dollar weakens, this could mean a win for Bitcoin.

🚀Bullish news. The Ethereum Shanghai update is scheduled for this week and Texas proposes a state gold-backed currency.

🐻Big, bad FUD. Hacker steals $3.3 million from Sushiswap after a smart contract exploit and Binance US struggles to find a new banking partner after Signature Bank.

📣The big story of the week

The great de-dollarization is here

In today’s issue, we’re zooming out to give you some macro news on the state of the US dollar. Why does it matter? Because a weakening dollar means a strengthening Bitcoin.

If you want a tl;dr, this video sums up the threat perfectly. Otherwise, let’s dig into this story.

Over the past 80 years, the US dollar has enjoyed its reign as the world’s reserve currency. Global nations around the world recognized USD as the currency for trade and settlement, which continues to drive demand for the US dollar.

However, the tide has been shifting for quite some time:

  • Russia and Turkey have been trading in their own currency over USD since last year

  • Russia also dumped $101 billion of USD in its reserve to replace it with euros and yuan.

  • More European gas buyers are following the demands of Russia and paying in rubles.

Notice a pattern? While Russia has spearheaded a lot of this initiative to dethrone the US dollar, it’s not the only one making moves. It also has the BRICs nation (Brazil, Russia, India and China) to rely on.

Most recently, Brazil and China announced their agreement to trade in their own currencies (yuan-real).

And this is only the beginning. Their next big plan is to create their own currency.

“The transition to settlements in national currencies is the first step. The next one is to provide the circulation of digital or any other form of a fundamentally new currency in the nearest future.”

Deputy Chairman of the Russian State

Why is this so significant? Well, the BRIC nations together make up half the world’s population, roughly 3.2 billion people. Their combined GDP has also recently surpassed G7 and is expected to contribute to over 50% of global GDP by 2030.

The BRIC nations aren’t the only ones moving away from the US dollar. This trend is spreading wider and wider to other countries.

As nations flee from the US dollar, retail investors are also taking note. For the first time in years, Bitcoin’s correlation to gold reached new highs and surpassed its correlation with the S&P500.

What does this mean? Well, all those times we said that Bitcoin is the “new gold standard” is actually becoming true. People are beginning to recognize that Bitcoin and gold are immutable stores of value. While we suffer from inflation and watch the fall of the US dollar, the best thing you can do is protect and diversify your assets now.

🚀 Bullish news

📆 Ethereum’s Shanghai update is scheduled for this Wednesday. The much-anticipated upgrade will allow over 18 million ETH stakers to finally unlock their assets, which could send the market into a full pendulum swing. We’ll either see a major sell-off or a big rush of new stakers and liquidity.

🤠 The state of Texas proposes a bill to create a gold-backed state cryptocurrency. This digital currency would be fully backed by gold and fully redeemable in cash or gold. Good to know that there are still lawmakers out there pushing against central banking digital currencies (CBDC), which would give the government more power to track consumers and inflate prices.

🐻Big, bad FUD

🍣 Sushiswap gets drained $3.3 million from a smart contract exploit. A majority of the funds belonged to one user, sifuvision.eth who fell victim to a hacker attack that exploited a vulnerability in a smart contract. Thankfully, some of the funds were recovered by BlockSec who were able to intercept the transaction. Stay safe!

🏦 Binance US struggles to find a new banking partner. After the collapse of Signature Bank, Binance has reportedly been having trouble finding a replacement to hold its customer funds. Looks like the government’s plan to kill the crypto industry might be working.