The Battle between Unilateralism and Multilateralism

JcollinsEconomics, FREEPOM, Geopolitical25 Comments

Where Blockchain Decentralization and Socioeconomic Multilateralism Intersect

 JC Collins

“It should have been so obvious.”

As the trade war between China and America develops, two interesting side stories are coming into focus.  These side stories have been building for years and are only now entering into their fundamental phase of escalation, transformation, and alignment.

But first, the growing trade war:

"We believe this is a battle between unilateralism and multilateralism, a fight between protectionism and free trade," the Chinese Ministry of Commerce said. "This is not good for China, or the world. Facing this serious problem, we must fight resolutely. We have prepared with a bottom-line mindset and have planned detailed action. We won't start a war, but if someone does, we will definitely fight back."

This statement is a response to President Trump’s threat to impose $100 billion in additional tariffs on China.  Both sides feel justified in their positions and are implementing counter-strategies which will have profound impacts upon the world.

The truth of the matter is that the Chinese Minister was spot on.  This is a battle between unilateralism and multilateralism.  To better understand the fundamentals of this battle, readers can reference the article The Real-World Potential of Ripple, which details the relative short history of the US dollar as the primary reserve currency used to balance global trade, and its inevitable replacement with a supra-sovereign monetary asset which isn’t controlled, or manipulated, by any one nation, or institution.

It is often suggested that China holds leverage over America because of the large amount of US debt which is held in the foreign exchange reserve account of the People’s Bank of China.  The $1 trillion USD plus in this account is equally as threatening to China as it is to America.  Both know this and both may, at some point along the way, decide that the consequences of reducing these reserves through sudden market dumps may be worth the immediate and long-term risks.

China could exchange a small or large portion of these reserves into something else, but on the end of every exchange there has to be a buyer and a seller.  Also keep in mind that a devaluation of the USD is in America’s long-term interests, as it would facilitate a lowering of the trade deficit through increased exports as American made goods became more affordable. Reducing international demand for dollars is a part of this strategy.

The American banking and business establishment is tasked with maintaining global hegemonic influence while international dollar usage shrinks and the geopolitical sphere transforms to reflect the increasing dominance of the emerging markets within the Eurasian continent. Maintaining a policy based around unilateralism would be counter-intuitive as the architecture of the world’s monetary and financial systems shift towards one based on multilateralism.  The geopolitical architecture will begrudgingly be forced to transform as well, but not without tension and periods of escalated aggression.

Another area where China may have some leverage is over its control of a large percentage of the raw resources which are produced globally.  China has been importing vast amounts of coal and metals.  This raw product is used in production and if American access was reduced to these materials and products, it could cause some serious ripple effects in the domestic economy.  Something I’m sure the Trump strategy team is well aware of.  (It is worth considering the recent announcement of a Ripple XRP based metals exchange.)

A few days ago an executive from Ripple, the blockchain based cross-border payments-solution company, stated that they were working with 40 to 50 central banks.  This is a profound statement, as it amounts to around a third of the central banks in the world.    As the crypto asset market cap increases, and the fiat currency market cap decreases, central banks will be looking to increase the amount of crypto assets they hold in their foreign exchange reserve accounts, while reducing the amount of fiat held.

This is where a Chinese strategy to exchange held USD for crypto assets could come into play.  The devaluation of the USD will not have the negative impact on Chinese holdings if the loses associated with those devalued holdings is offset by the appreciation of increasing crypto asset holdings. China could exchange and diversify a portion of their USD reserves for a crypto asset, or number of crypto assets.

Based on the expanding usage of Ripple’s XRP inside and outside of China, it’s not hard to reason that exchanging USD reserves for XRP would be something worth considering by the Chinese monetary authorities. Some of the XRP being held back by Ripple could be used specifically for such a purpose.  It would further validate XRP as the dominant global monetary asset which exists on a decentralized interledger protocol, and which also is not controlled or manipulated by any one nation or institution.

Other nations would take notice and the decreasing international demand for USD which followed would cause the USD to devalue against XRP as XRP demand increased.  It would allow the American domestic currency to be released from its international accountabilities and provide further opportunity to adjust America’s domestic economic policies to reflect the changing trade environment.

As more central bank validators are added to the XRP ledger, the ledger will become even more decentralized.  This is exactly what nations like China would want.  It is even in America’s long-term interest to encourage such a transition from centralized unilateralism to decentralized multilateralism.

It is not an exaggeration to state that we are living in a profound time of change right now.  The movement of wealth and value around the world has built and destroyed empires for thousands of years.  With decentralized ledger technology (blockchain) the movement of wealth and value around the world can now happen in seconds for just fractions of a cent.  No one entity controls it.  No one nation or conglomerate of business and banking interests can reap the majority of benefits.

“It should have been so obvious.”

Back to the two side stories - one is the development of the crypto market, and the other is the transition to the multilateral framework which has been incrementally happening for years now. Both stories are being overshadowed by the growing trade war between America and China.  Yet, it is that very same trade war which could fulfill the ultimate potential of both the crypto market and the multilateral promise of global balance and access to wealth around the world.

When open borders promoter George Soros himself is starting to invest in the crypto market, you know the big central bank and institutional money is not far behind.  We are on the cusp of a global transformation which will lay the foundations for the next century of human endeavor.  - JC

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25 Comments on “The Battle between Unilateralism and Multilateralism”

  1. JC, Since peaking in January, Ripple (XRP) has lost almost 90% of its value as of today and may not even find a bottom for several more months. BitCoin has also lost almost 80% of its value since its peak and is still going down.

    By any investors measure, that is a rather serious correction, if not a major Bear Market. How can these be a store of value when they rise and then collapse so quickly?

    1. The whole crypto market has dropped, but most are still higher than they were in November. The volatility will not always be there and the store of value concept will not necessarily apply to crypto assets in the same way. But based on that traditional understanding the store of value for crypto is the ledger itself, and the information on the ledger.

      Also, XRP will be used as the bridge currency and the volatility will not matter. The exposure for banks to the volatility will only be for the few seconds it takes for a transaction to complete. Reserves of XRP, or liquidity pools for the interledger, will fluctuate with the volatility, but will continue to creep up in value based on a depletion of supply. If you look at the crypto market from the beginning there are always the big proportional drop which takes place at the beginning of the year.

      Last, the argument that banks can create their own cryptos and ledgers and will not have to use XRP represents a gross misunderstanding of the technology. Ripple has the interledger which will connect all ledgers and payment services. The more national cryptos and ledgers the better for XRP. The one ledger to rule them all. So to speak. I know you didn't make that point, but I wanted to take the opportunity to make the counter-point.

  2. You are overlooking the risks associated with China being a prime supplier for steel used in US weapons, ammunition, and classified computer chips used to govern US weapons systems.

    These issues have already caused mishaps and deaths of US personnel!

    We should NEVER allow a potential rival like China to have such a preferential position!!

    1. Steel is raw material, which I mentioned int he article. Fully agree with your point, but there is only so much I can put into an article without turning it into a mess. Thanks for bringing up that point Curt.

    1. Agreed. It's strange, I'm very at ease and patient with the whole Ripple thing. The lower it goes the more I/m buying. This is a 3+ year investment. I actually think we will end up always owning the XRP, as we will never need to exchange it back into fiat.

      1. LIke a light bulb! Awhile back I was exploring how to purchase XRP without a bank account, and concerned more about how to get the profits of investing in XRP back out.

        Dane challenged my question with a simple "back out to what?" My answer was, Well fiat of course. But the question haunted me, so further consideration gave rise to this response. "Hmmmm? Allow me to get back to you on that."

        So, back at you Dane, my good men, JC just now provided me the answer.

        Loving the POM.
        PTM

        1. Lol. I can see XRP being like the SDR and regional blockchain currencies minding their respective regions. It could be like JC explained early on with the multilateral only with blockchain currencies instead of fiat currencies. Sure is going to be weird for a while. I think I'll invest in some sort of tether for my phone so I don't forget it somewhere. It should be more valuable with digital assets processing through it. Heck they will be like the new debit card and maybe a target for thieves. More so than now. But I like the added responsibility that comes with this digital system. At least until I accidentally send crypto to the wrong wallet address...Lmao.

  3. JC, You have also mention that George Soros is about to become a Crypto investor but Soros is actually a Trader who plays both sides and some of his biggest wins have been on the short side (e.g. shorting the British Pound). He actually called the BitCoin Crypto bubble so he may be planning to short cryptos (I personally think that was the whole reason for adding BitCoin to the Futures market so Wall Street would have a way to short it.)

    Tone Vays is a good source for Crypto projections and is active on YouTube but has a tendency to be too bullish. Here is another site that puts out information on Crypto trend analysis. The site called the top in BitCoin quite accurately in late December and sees further pain ahead for another few months. Maybe a good buying opportunity this summer. Here are a couple of links:

    https://surfcity.co/2017/12/30/bitcoin-btc-cycle-update/

    https://surfcity.co/2018/03/29/crypto-crash-dead-ahead/

    1. Thanks for sharing. I agree that Soros intentions need to be considered carefully. We will likely see a split in the crypto market in the future, as regulation takes hold and some, like XRP, take on a whole new dimension. Crypto isn't going anywhere. Period. It's here for the long term. The future for it has several different paths.

  4. Hi JC ,

    Ripple's statement about their connexions with 40 or more central banks is something to consider. Is there a link or more , somewhere, to confirm the validity of this statement ?
    I mean , this is really really a bold assertion , kind of game changer in this strange period of monetary trouble .
    No doubt in my mind that XRP and Ripple will be part of the global monetary transformation . I have the same strategy as you , adding quietly more XRP as time goes by and value is cheaper and cheaper and I sleep very well at night . Don't know how much time it will take to see the dollar demise and the rise of a new monetary architecture ( I guess between 3 to 5 years from now ) , but there is still one point that can be dangerous about XRP .
    For now , we already are in a currency war , and to the point of starting a trade war with China . All nations are still in partnership in the monetary front , working with IMF , WorlBank and BIS .
    But if the US start a real trade war , why should China use Ripple , a US company , to protect his wealth ? It is well known that the Chinese have a strategy to duplicate all western institutions to cut western influence and increase their own power .
    Why not try to launch their own " Asian Ripple " ? They do have the technical skills . And if this trade war escalates into a real war , why should they not play the patriotic cord on a monetary plan with cryptocurrencies ? We hear drums of war in so many places around the globe.......
    This is the only point that bother me in the future of cryptos......
    Could you tell us what you think about this kind of risk ?
    Thanks for all of your writings........!

    1. It was a Ripple executive at a conference in Thailand last week. You can watch the words come right out of his mouth on tons of YouTuve videos of the event. Just search Ripple 4o central banks and pick from the list of videos. Isn't it interesting that 40 to 50 central banks is the exact range of the 44 allied nations which participated in the Bretton Woods conference? Just an interesting parallel.

      China will use XRP for the simple reason that the interledger will be completely decentralized. More than any other ledger. This is a lot of false information about this out there. But the reality is that each nation and bank which joins the ledger will have its own validator on the network. No one nation, bank, or institution will control the XRP ledger. Not even Ripple. This is exactly what everyone needs.

      China, and other nations, will have their own crypto asset and ledger, but the XRP interledger will connect them all, with XRP being used as the bridge asset to complete transactions. Want to exchange renminbi fiat for Bitcoin, use XRP. Want to exchange USD crypto asset for Ethereum, use XRP. It will be the dominant monetary asset in the world, through its use across multiple platforms and function, including a whole new industry of micropayment which will start to emerge.

      Central banks will place XRP, and other cryptos, in their foreign exchange reserve accounts. Everything will flip over the next few years. A true fundamental change. We are only just now beginning to understand the full impact of what is happening, and what is coming.

  5. "George Soros, the billionaire investor and philanthropist working to ease the global refugee crisis, said Thursday that he’s found a new way to help migrants: blockchain technology."

    http://fortune.com/2018/01/25/bitcoin-blockchain-billionaire-george-soros/

    If migration is used to infiltrate protestant dominated regions in order to promote the crown beasts version of democracy wouldn't blockchain be able to enable the open society foundation through its funding of migrants by giving them a way to receive information or get information on the ledger while transferring and keeping their money safe? Furthermore, wouldn't it allow the same between the hundreds of organizations his open society foundation does business with around the world? In this case the crown beast has sold to its followers that IT is the North Shore Road and as such the blockchain could serve as their umbilical cord couldn't it?

    http://fortune.com/2017/10/17/george-soros-open-society-18-billion/

    1. Hahaha, Peter I follow in your footsteps brother. "receive information or get information" should have read "receive information or send information". Dumbass Dane receive and get is the same thing....lmao. Must have been down on a goat path...:) Backing up to the North Shore Road I guess I should have gave one more proofread prior to hitting that submit button.

      1. Dear Dane, I hope we are not misunderstanding each other. The point I was trying to make was JC's answer to Onrgaia wherein he said, "I actually think we will end up always owning XRP, as we will never need to exchange it back to fiat."

        As the light bulb came on in my head I was reminded of your profound answer to one of my questions about exchange from XRP back, and your response was back to what. My response was, Back to fiat of course, but with further reflection my best answer was a "hmmm, let me get back to you on that.

        My mention of that earlier commentary was to pay high compliment to your insight with your prodding question "back to what?" With JC's current response I believe I now see the wisdom of your prompt. I other words, once you go XRP why go back.

        You are having a hard time convincing my that there is much dumbass in you. I'm sure there are some in your personal life, those that deeply know and love you that can with affection point to that fact. But here on the POM there is little or none to any to warrant that slight.

        Friend
        PTM

        1. No Peter I got you. I referenced you because you aften comment about hitting the send button too fast. I did too. But had I proof read it one more time I would have caught the mistake in my grammar. Hence the dumbass Dane. It was a funny responds to my foopa. Nothin to do with your comment pal.

  6. If I could change the world.
    https://youtu.be/kutzQiaFzOQ

    Here is what I would do. I would unabashedly jump on JC's coat tails and develop a "site" that would use his following to continue their comments between his postings and beyond. Why do I say this? Why not. Nobody is doing it, and I hear'knockings' at the door.

    The 'knockings' come from my habit of going three of four postings back to check up on the "reply" to my own comments, and noticing that the 'life' of any one comment section relies on the JC's next post, thus I feel a vacuum, a hole, that needs filled.

    This agency of change I'm proposing is in no way intended to rob, but to advance what goes on in the POM. Oh, and by the way I personally have not a clue as to exactly what I'm talking about here, or how to make it happen. Fine statement there to include in a plan of business at hand . Not all business includes COIN, the best are the commerance (dance) of ideas.

    So I say, Thank you to those who have responded to my comments in past postings that I have moved past without reply, it is the flow and feeling of 'what's the use now' we are past that. There is the hole I want to fill.

    How? Help me. There is the legal question of copyright protection that I, with all grace grant JC for his production. See what I'm saying? And then any moral or ethical arguments as to "coat tailing" JC's profound work. However, the man is busy(on a mission) and expansion of the comment section makes some sense to me.

    If you JC and any agree please 'comment' and perhaps suggest some, how.

    A mysterious joy and pain was in this man, I suggest he answered the "knockings."

    Somewhere over the rainbow
    https://youtu.be/V1bFr2SWP1l

    PTM

    1. Pieter, I’m working on a new site which has nothing to do with WordPress or someone else’s server. One of the features I want to have is an open forum chat feature which is separate from the articles. I’ll be asking a few of you to work with me on the beta testing of the site before it goes live. You and Dane will be two of these beta testers. How does that sound? I’ll provide more info to you guys, and a few others, shortly.

      1. What's in it for me??? Mein Kampf.

        The truth be known, I'm almost giddy with the idea. I would be honored, I'm already proud of the fact you realize the "hole" I spoke to.

        Are you sure you want that Dane dude involved?? Just saying.

        hehe
        PTM

      2. What, how'd I get wrangled into this? Dang it Peter see what you started? Bwahahaha, j/k I will be glad to help in any way I can sounds fun. It will be nice to be away from word press.

  7. "Washington forces its allies to accept a bipolar world

    The recent bombing of Syria had several purposes for all sides involved and the one major outcome which the article by Thierry Meyssan explains is the return of two major powers. This implies the end of the Neocon's influence in the US foreign policy and the end of the Wolfowitz doctrine and the death of the New American century project by the same globalist people who were in charge of many millions of deaths, mostly in the Near East and North Africa. This also shows, that in a dualistic world, no one power can exert absolute pressure and act as the sole supreme power, which also means that globalism can never ever be achieved. This harsh message will finally be absorbed and understood, by the EU project managers and will in time be accepted.

    "By bringing France and the United Kingdom into the fray, President Trump has forced them to accept the reality they were refusing to see."

    http://www.voltairenet.org/article200729.html

      1. Hi Dane,

        Thank you for the clip regarding the Golan Heights and the discovery of gas/oil. The rabbit hole goes very deep and the further you go, the more other rabbit holes you will discover and all Designed that way so getting to the end is made deliberately difficult.

        I can absolutely recommend the following article by the American Intelligence Media and the discussion about the article which will illuminate much of what is hidden, in the open and at front of us all. The Golan height's oil has been most likely to have been funded by the same group as per the article suggests.

        https://americans4innovation.blogspot.com/2018/04/the-shadow-government-uses-ses-serco.html

        In short, the entire Crown Beast system is simply about the looting of this planets wealth and all wars, Coups, Revolutions are related to this looting system. One of the most recent was the Libyan invasion by NATO and the European colonial powers with the US headed by Obama and Hillary Clinton as the invading general of this rich North African country. The entire gold and sovereign wealth assets all divided up between the looting nations. Syrian is an exact theme but it is likely to end because Russia is standing in the way of the Phoenician looters!

        The following regarding this system that runs deep also in the US is recommended:

        https://www.youtube.com/watch?v=IhvH3ntEAJo&t=1s

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