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Ares
6th May 2013, 06:20 PM
Throughout history wars have been fought for a number of reasons, not the least of which is economic gain. The traditional means to that end has been physical combat, but were now in a new era an era where wars are increasingly fought with technical and financial means. The US has already fallen victim to widespread cyber attacks originating in China and is suspected of conducting its own technological attacks on others.

The recent economic crisis showed the world how susceptible even powerful nations are to financial tumult. Displacing the USD as the global reserve currency would put China closer to their explicitly stated aspirations without ever having to engage the worlds strongest military.

At the end of last week China Central Television, a state-run broadcaster, aired a documentary offering an overview of bitcoin and its potential benefits. Given the tight controls the Chinese government has over mainland media, this was not just tacit approval from the worlds second largest and centrally-run economy. It was a continuation of an ongoing series of rhetoric and actions to undermine the US Dollar, as well as destabilize the beneficiary of global reserve currency status: the United States.

China Wants to Remove the US Dollars Reserve Currency Status

Since the end of World War II, the US Dollar has enjoyed the benefits of being the worlds reserve currency. The dollar has remained strong as a result of being the denominating currency of roughly 60% of global bank and sovereign foreign currency reserves, as well as the de facto medium of exchange for major commodity transactions. The reserve currencys issuing nation receives a number of unique benefits, not the least of which is the ability to borrow money at significantly lower rates, as has been heavily taken advantage of by the US.

China has been outspoken for years about their desire to find a replacement for the USD as the worlds reserve currency, citing the dollars susceptibility to volatility and inflation. That concern is not new to the global stage and was famously addressed in 1971 when US Secretary of the US Treasury John Connally told a group of European finance ministers that the dollar was our currency, and your problem.

Since the global financial crisis began China has been on an unabated campaign to displace the dollars coveted position bitcoin provides a potentially game-changing tool in that arsenal. Below is a brief timeline of the escalating currency war China has openly waged:

March 2009 China central bank governor Zhou Xiaochuan appeals to the G20 to create a new currency standard to replace the dollar as global reserve. Keep in mind that bitcoin was in its infancy when this recommendation was made this appeal likely would have referred to a basket of many currencies or notes issued by the International Monetary Fund.

September 2012 China announces it will begin selling oil in currencies other than the dollar. Since the 1970s, global oil sales have been conducted in dollars as a result of longstanding diplomatic agreements the US made with major oil producing nations.

September 2012 A member of Chinas commerce ministry publicly recommends using their position as Tokyos largest foreign creditor to launch a bond attack on Japan.

The comments were made amid escalating territorial disputes and suggested China impose sanctions on Japan in the most effective manner by selling large quantities of Japanese bonds to drive up the neighboring countrys borrowing costs.
Worth noting: China is also the US top foreign creditor, holding more than 7% of outstanding US debt.

March 2013 Chinese central bank Deputy Governor Yi Gang declares China is fully prepared for a currency war, specifically noting China will take into full account the quantitative easing policies implemented by central banks of foreign countries.

March / April 2013 China bypasses the USD as an intermediary of exchange by opening direct swap lines with Australia and Brazil to build trade with the two nations without requiring a facilitating swap to USD.

China Brings Bitcoin to Its Populace

Last week CCTV, the predominant state television broadcaster in China, aired an overview of bitcoin explaining both how some folks have made money from the new currency and how many see it as a speculative bubble. The Chinese government, which has more than a dozen agencies regulating media and information flow, clearly wants its population to know about bitcoin despite the successful global use of the currency to circumvent capital controls and undermine central authority governmental aspects China takes quite seriously.

If China successfully aids the proliferation of bitcoin, the implications on the global currency system could be monumental. Rather than having to use USD as an intermediary currency or establish swap lines to support international trade, a world conducting trade with bitcoin would mean the USD currently used for this purpose would be leaked as additional supply in the Forex markets, driving down the value of USD and driving up borrowing rates for the US. This change, on a large scale, would drastically accelerate the effects of the inflationary policies already taken up by the Federal Reserve. A significant inflationary trend in USD could potentially create a devastating cycle as global banks looking to preserve their wealth seek alternative reserve currencies, even further reducing the dollars value.

The effect in China and on the bitcoin market is already being realized. Bitcoin wallet software has been downloaded nearly 40,000 times since the program aired three days ago thats almost 7 times the number downloaded in the US over the same period and 13 times the rate of downloads in China leading up to the report.

If this trend continues, we may have just witnessed the single most significant event in bitcoin history since the currencys inception.

http://www.thegenesisblock.com/wp-content/uploads/2013/05/wallet-downloads.png?c07b35

http://www.thegenesisblock.com/bitcoin-the-newest-tool-in-chinas-currency-war-chest/

vacuum
15th October 2013, 08:02 AM
Baidu, the 'google of china' just announced it is accepting bitcoins for one of it's services. Huge news. Bitcoin is up significantly today.

https://bitcointalk.org/index.php?topic=310962.0;topicseen

Ares
15th October 2013, 10:41 AM
Baidu, the 'google of china' just announced it is accepting bitcoins for one of it's services. Huge news. Bitcoin is up significantly today.

https://bitcointalk.org/index.php?topic=310962.0;topicseen

I've noticed, I still have my 60Gh/s miner going. I average about 25-28 dollars worth of Bitcoins a day. Not bad I suppose. But definitely not the 100-200+ I was hoping for. Butterfly Labs really dropped the ball on this product development, implementation, building and shipping.

I actually pointed my scrypt miner to middlecoin.com which is a pool solely for mining the most profitable alt coins and paying you in bitcoins. I average 2-3 dollars a day with my scrypt miner doing that. Beats the 1-1.50 I was making before.

I think as time goes on, more countries and services will start accepting Bitcoin. Next phase is a more user friendly application or product that can make use of storing, paying, receiving bitcoins. I can't code for shit, but if I did I would get involved in that. I know network security and intrusion prevention techniques. But software development is definitely a really weak point for me.

Son-of-Liberty
15th October 2013, 01:10 PM
Man I wished I had more BTC right now.....