How Is BTC Profiting from the Expiration of the US-Saudi Petrodollar Deal?
Bitcoin (BTC) looks set to benefit from the expiration of the US-Saudi petrodollar deal. Moreover, the financial world is preparing for a shocking change following Saudi Arabia’s decision not to renew the long-standing security agreement with the United States, which expires on June 9, 2024.
This significant move allows Saudi Arabia to sell oil and other goods in various currencies. These include the Chinese RMB, Euro, Yen and Yuan, rather than just the US dollar. The use of digital currencies such as Bitcoin can also be explored.
US-Saudi Petrodollar Agreement Ends
The latest development marks a significant departure from the petrodollar system established in 1972, when the United States separated its currency from gold. Additionally, the decision is expected to accelerate the trend away from the US dollar globally, and Bitcoin is expected to gain significantly from this shift.
Saudi Arabia announced that it has joined Project mBridge, a cross-border trial of a Chinese-dominated central bank digital currency (CBDC). This move underlines its determination to diversify its economic dependencies. The Bank for International Settlements (BIS) announced Saudi Arabia’s full participation in the mBridge Project.
The project involves the central banks of China, Hong Kong, Thailand and the UAE. “The most advanced cross-border CBDC project has added a major G20 economy and the world’s largest oil exporter,” Josh Lipsky of the Atlantic Council said, according to Reuters.
The mBridge platform, currently in the “minimum viable product” phase, aims to facilitate cross-border transactions using CBDCs. Additionally, the platform has compatibility with the Ethereum Virtual Machine, which is the backbone of the Ether cryptocurrency network. This opens up new avenues for digital currency transactions.
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How Will Bitcoin Benefit from This Development?
Prominent crypto analyst Doctor Profit wrote in a post on X: “The US-Saudi petrodollar deal is expiring and will not be extended. This will force the USA to print tons of new dollars!” The expected increase in dollar printing is expected to lead to an increase in inflation.
As inflation rises, the value of fiat currencies such as the US dollar tends to erode. It will also lead investors to seek refuge in alternative assets. With its fixed supply and decentralized structure, Bitcoin is positioned as the main beneficiary of this change.
Additionally, the analyst predicts a bullish trend for Bitcoin. “From this day on, the dollar will be under heavy pressure, the dollar will be printed, inflation will start to rise. “Rise is Expected in Gold, Bitcoin, Stocks and Real Estate.” The short-term economic turmoil expected from this transition may be daunting, but the long-term prospects for Bitcoin are promising.
One concerned user noted that average people will not invest in Bitcoin, gold or other assets when inflation rises. Doctor Profit responded: “Do you think the market needs average people to move? It’s more of a long-term rise. The effects of this change will be seen 8-12 months from now,” he said.
As traditional financial systems face instability, Bitcoin’s role as a hedge against inflation becomes even more evident. Moreover, Bitcoin’s decentralized and deflationary properties make it an attractive store of value. Bitcoin also provides a hedge against the devaluation of fiat currencies.
Doctor Profit also noted: “Soon the USA will realize that it cannot beat inflation. They will manipulate the masses just as they have manipulated the inflation basket lately. They will make it look like inflation has been defeated to justify printing new money. Their goal is very clear: TURN ON THE PRINTERS!!”
Also Read: Bitcoin Price Analysis: Renewed Whale Interest Indicates BTC Will Hit New High Next Week
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