Smart Money

A second Cold War is underway. But whereas the Cold War of 1945-90 was dominated by the threat of nuclear conflict, the new front line will be economic. A race for the future of money has begun - and the outcome of who wins is the most significant geopolitical struggle in the new Cold War between China and the US.

For decades following the Second World War, the US dollar was the global reserve currency, with oil paid for in dollars and much international trade carried out in the US currency. But no longer. More than a hundred countries are developing Central Bank Digital Currencies (CBDCs), which are digital equivalents to cash rather than digital representations of cash, which means they are programmable, unlike normal money.

China was the first country to recognise the significance of this shift, creating the digital yuan. While the West's media focused on the new currency's role in China's surveillance state, it largely overlooked a more important aspect of its existence: as a potential alternative to the dollar. When China's President Xi officially launched the digital yuan in February 2022, he also agreed a pact of limitless co-operation' with Russia. Within days, Russia launched its war on Ukraine, secure in the knowledge it would be able to buy oil without paying in dollars.

Urgent, clear-eyed and ground-breaking, Brunello Rosa and Casey Larsen will show us how control over the supply of money is going to impact all of our futures. As Lenin once famously said, there are decades when nothing happens, and weeks when decades happen'. The weeks are happening right now, and if the West is to claw back China's huge lead, it needs to act fast, and act now to ensure that global digital currencies are democratically controlled.