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IPFS News Link • Currencies

When will the renminbi overtake the dollar?


Without a doubt, the existing global financial system depends on the widespread use of fiat currencies issued by insolvent governments.  The wealth of the world’s large financial institutions requires that there be currencies with sufficient size and circulation to absorb massive capital flows.

The current system is based primarily on the dollar; with a $14 trillion economy, the United States was for years the only country in the world with a sufficient money supply and financial infrastructure to take in the preponderance of the world’s wealth.

It is for this reason commercial loans, commodities contracts, international reserves, and cross border settlements have traditionally been denominated in US dollars.