BRICS on Cryptocurrency Mining & Sanctions

• Alpha Picks is giving away HUGE discounts!

BRICS: Sanctions Turning Chinese Yuan as Main Currency, Not US Dollar

US Treasury Secretary Janet Yellen has confirmed that sanctions have prompted BRICS to begin global de-dollarization initiatives. The US imposed sanctions on Russia in February 2022 due to its invasion of Ukraine. Since then, BRICS has been working to reduce its reliance on the US dollar, opting to use local currencies such as the Chinese yuan for trade settlements.

BRICS has weaponized development by warning developing countries that their economies could collapse if they were subjected to US sanctions. As a result, these countries and BRICS members have started using the Chinese yuan for trade with China instead of the US dollar. Russia has also embraced the Chinese yuan for oil payments, making it the most widely used currency in trade within two years.

Economic analyst Alexandra Prokopenko noted in her paper that the Chinese yuan is reaping the benefits of the sanctions on Russia. The sanctions have aligned with BRICS' de-dollarization efforts, further strengthening the agenda.

The decision will have significant implications for the USD and may result in local currencies strengthening globally. The next few years will be crucial for the survival or demise of the US dollar in the face of de-dollarization efforts.

Let's discuss the significant issues related to the fast expansion of cryptocurrency mining.

In recent developments, the BRICS nations—comprising Brazil, Russia, India, China, and South Africa—have collectively voiced significant concerns over the rapid expansion of cryptocurrency mining within their borders. This emerging issue has sparked extensive deliberation among policymakers, driven by the potential risks associated with unchecked mining activities, particularly in terms of electricity consumption and its broader implications for national infrastructures and economic stability.

Evaluating the Impact of Cryptocurrency Mining on Electricity Consumption

At the forefront of these concerns is Russia, where President Vladimir Putin has underscored the precarious nature of the situation posed by cryptocurrency mining operations. Putin highlighted that the exponential increase in electricity demand from mining activities could lead to severe strain on regional power grids, potentially resulting in widespread blackouts and disruptions to essential services. According to Russia’s Energy Ministry, the current annual electricity consumption attributable to crypto mining already accounts for nearly 1.5% of the country's total usage—a figure that is expected to escalate without stringent regulatory measures in place. 

Key Points from the BRICS Warning:

1. Electricity Consumption Concerns: The disproportionate energy consumption associated with crypto mining poses a significant threat to Russia’s infrastructure development and energy security. President Putin's remarks underscored the urgent need for regulatory interventions to mitigate these risks and ensure sustainable energy use across the nation's diverse regions.

2. Regulatory Measures: In response to these challenges, Russia is actively pursuing comprehensive regulatory frameworks aimed at managing and mitigating the impact of crypto mining. Proposed measures include the introduction of taxation and tariff schemes tailored to the energy-intensive nature of mining activities. Additionally, efforts are underway to enforce compliance with stringent environmental standards to curb the ecological footprint of mining operations.

3. Global Economic Implications: Beyond domestic considerations, the BRICS nations recognize the transformative potential of cryptocurrencies and digital assets in reshaping global financial systems. However, the bloc remains committed to adopting a cautious and balanced approach to regulation, seeking to harness the benefits of digital innovation while safeguarding against potential economic vulnerabilities and market instabilities.

4. Geopolitical Dynamics: The unified stance of BRICS on cryptocurrency regulation also reflects broader geopolitical strategies and alliances, influencing global economic policies and partnerships across diverse regions. By aligning their regulatory frameworks, BRICS nations aim to promote sustainable economic growth and technological innovation within a cohesive global framework.

Russia’s Strategic Initiatives and Future Directions

Putin’s directives for comprehensive regulatory frameworks underscore Russia's proactive stance in addressing the multifaceted challenges posed by crypto mining. By prioritizing regulatory clarity and sustainable energy practices, Russia aims to enhance the resilience of its national infrastructure and support long-term economic development goals amidst evolving global economic landscapes.

Thailand’s Diplomatic Maneuvering Amidst Geopolitical Shifts

Meanwhile, Thailand’s proactive bid to join BRICS signals its strategic pivot towards diversifying geopolitical alliances and economic partnerships. Simultaneously pursuing OECD membership, Thailand navigates a delicate balance between Western and Eastern economic spheres, positioning itself as a pivotal player in global diplomacy and economic cooperation.

Commentary on the Global Implications

The BRICS warning on cryptocurrency mining encapsulates broader debates within global economics and governance. As these emerging technologies continue to reshape financial landscapes, the regulatory responses by BRICS nations are crucial not only for their domestic stability but also for influencing international norms and standards. By addressing the environmental and economic challenges posed by crypto mining in a coordinated manner, BRICS aims to set a precedent for sustainable digital economies worldwide.

The BRICS warning on cryptocurrency mining serves as a pivotal call to action for comprehensive regulatory frameworks to responsibly manage the burgeoning digital economy. As global interest in cryptocurrencies continues to rise, coordinated efforts among nations are essential to harnessing their potential while mitigating associated risks. By prioritizing sustainable energy practices and strategic regulatory interventions, BRICS nations aim to foster a resilient digital economy that aligns with global sustainability goals, economic stability, and equitable development across diverse geopolitical landscapes.

That’s it for this episode!

Stay informed. Stay vigilant. Stay ahead.

The Modern Warfare Team

Disclaimer: This newsletter is for informational purposes only and should not be construed as financial or political advice.

Paying the bills

Our newsletter is powered by #beehiiv, which partners with trustworthy and high-quality advertisers. We receive payment from the advertisers for each verified click. By clicking to explore the products or services being promoted, you may find something valuable. When you click, not only do you have the opportunity to benefit from the ads, but you also help support our efforts to improve our newsletter for you as our readers or listeners. All profits are reinvested into growing our newsletter to provide greater value to you. Your genuine engagement with the ads would mean a lot to us.

Today’s sponsor is…

Affiliate of the day

What is Alpha Picks?

Two data-driven stock picks each month to hold long-term

Access to all Alpha Picks (over 20 stocks) on day 1

The stock picks cover multiple sectors

The performance to date has significantly outperformed the S&P 50