Bitcoin & The American Empire
Dear Readers,
We are upon three years of our YouTube channel, and coming up on four of this publication. And what a ride it has been—we are now eight people strong at The Bitcoin Layer and strengthening our resolve, and from our perspective, quality, with every passing day.
I feel lucky to be building an independent research platform at a most exciting time. With the emergence of bitcoin and a global reordering that began on November 5, 2024, we have the distinct and rare opportunity to walk through history as it unfolds. Those of us who have read about the Bretton Woods agreement of 1944 are confronted by the sudden realization that the next version of global monetary coordination is being negotiated from Florida to Geneva to Riyadh.
Changes are in the air. We are already half a year into a global reordering that is finally seeing international dialogue. As bitcoin investors, we must ask whether or not the new world order is good or bad for bitcoin as an asset class, so let’s qualitatively assess how today’s geopolitical changes and the prospect of a renewed American Empire affect the going assumptions for the orange coin.
What has the bitcoin thesis been all along?
Has it changed?
Where does it stand today?
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Smart macro analysts don’t just watch the Fed. They watch the world.
Europe
Thanks to Caitlin Long for flagging this one down as it lines up with one of our major themes—a financial war between the US and Europe, specifically the Eurodollar system. If we are to interpret the White House communications around international economics, the ability for foreign nations to use the dollar system is now considered an “economic good” that must be paid for. Europe is now facing that charge.
In an article from Reuters, we learn that the ECB is now putting out a message that dollars might not be available in a crisis.
It begins:
European Central Bank supervisors are asking some of the region's lenders to assess their need for U.S. dollars in times of stress, as they game out scenarios in which they cannot rely on tapping the Federal Reserve under the Trump administration, three people with knowledge of the discussions said.
Nearly one-fifth of euro zone banks' funding needs are denominated in U.S. dollars, with the lenders borrowing in markets for short-term funding that can shut down abruptly in times of financial stress. In the past, European central banks borrowed dollars from the Fed, the source of the currency, to make up for the shortfall.
Cannot rely on tapping the Fed under Trump. This is pure evidence that we are in the middle of a financial war.