Dollar hegemony after financial crisis ... Yuan · Euro Challenges 'Currency War' Codecs New Variables
PC: pixabay.com
Bitcoin and other ciphers have emerged as new variables in the world's key currency competition. As the Chinese yuan and the euro used by major European nations exceeded the dollar's hegemonic currency,
(1) Dollar currency, euro, yuan 'currency war' new phase
Until now, the 'currency war' surrounding the position of the world 's key currency was the fight against the dollar that held the hegemony, the yuan which challenged it, and the euro. China 's offensive, the latecomer, was especially prominent. The yuan has become the fifth currency of the Special Drawing Rights (SDR), the reserve currency of the International Monetary Fund (IMF) in 2016. After the dollar, euro, pound, and yen, it has become the world 's five largest currencies.
Cryptography has shaken the existing monetary warfare framework. Cryptography denies the US dollar hegemony as well as the centralized currency order itself. Cryptography is based on block-chain technology, which allows for direct transactions. It is possible to do all transactions without intermediaries such as banks as well as central banks.
It is suggested that beatcoin, which is a representative of cryptographic money, has appeared in connection with the global financial crisis. The financial crisis alarmed the global economic order led by the United States after World War II. This was a decisive moment for the dollar's hegemony to shake. In addition, the distortion of the currency order in the process of overcoming the financial crisis of major central banks caused a meeting about the existing system.
For example, the Federal Reserve, the US central bank, lowered the benchmark interest rate to zero to stimulate the economy and released trillions of dollars through the quantitative easing program. The dollar, which had been a victory in unprecedented measures, leaned in weakness. There is criticism that the US is unilaterally trying to raise the export competitiveness by lowering the dollar price in the emerging countries' camps. This is why the appeal of decentralization and decentralization of cryptographic money attracted attention.
(2) Threat of power in the foot ... Legal currency vs password
Cryptography viewed from the existing currency order is 'public enemy'. This is because the cryptographic currency itself raises questions about the power itself, which is regarded as the greatest power that governments have exercised since the beginning of the period.
The same holds true for the currency hegemony. Whether the dollar keeps its position as the world's key currency, the euro or the yuan will replace the dollar, or if the cipher money, such as bit coin, is taxed, the hegemony within the existing currency order is likely to lose power. John McAfee, the cyber security industry giant, has already determined that a "front" has been drawn between governments and cryptography for this reason.
However, the opinions of the governments that have been revealed so far are mixed. Japan recognized cryptographic money as a means of payment, but China imposed strong regulations. There are a lot of countries that have not been able to clear their positions yet, including Korea.
In the G20 (major 20 countries), there will be a debate about the first regulation on passwords in the near future. Germany and France will call for virtual currency regulation at the G20 Finance Ministers and Central Bank Governors' Meetings in Argentina in March. The two governments are planning to submit a guideline for cryptographic regulation.