Monday, August 28, 2023

It's good to be back! :) missed y'all

“Do not fear to be eccentric in opinion, for every opinion now accepted was once eccentric.” – Bertrand Russell ||

Hello everyone! Good to be back! I missed you all, but I won’t lie, I had an amazing break, and I thank you all for your indulgence there. I rested, ate a lot, finished some books, watched some great movies, went axe throwing, fixed niggling things around the house, and spent hardly any time on Twitter – restorative and refreshing.

Below I touch on more signs that geopolitical forces are shifting and the potential impact on crypto ecosystems, including the latest BRICS expansion, Shanghai’s blockchain and India’s latest public service blockchain application. There’s not much of a market comment today (no charts for a change!), since I see the BTC and ETH prices haven’t done much in my absence. Oh, I was on the Bloomberg Crypto show last Tuesday, with Kailey Leinz and Matt Miller (I really need to get a good microphone).

You’re reading the premium daily version of Crypto is Macro Now. In this newsletter, I give some depth on factors I’m keeping an eye on that highlight the growing overlap between the crypto and macro landscapes – my focus is on how crypto is affecting the global economy, and vice versa. There is often a market discussion as well, because that is an important piece, not just for the structural changes but also for investor sentiment, which impacts attention and funding. Nothing I say is investment advice!

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IN THIS NEWSLETTER

• The crypto impact of the BRICS expansion

• China’s emerging blockchain ecosystem

• Forensic evidence on the blockchain

WHAT I’M WATCHING

The crypto impact of the BRICS expansion

At last week’s BRICS summit held in South Africa, the leaders of Brazil, India, China and South Africa (Putin was unable to personally represent the “R” in the acronym due to an inconvenient order from the International Court of Justice for his arrest) met with leaders from approximately 60 nations to discuss trade agreements and the bloc’s strategic objectives, among other things. One surprise announcement to emerge was the official expansion of the group, with invitations to join extended to six more nations: Saudi Arabia, Iran, United Arab Emirates, Egypt, Argentina and Ethiopia.

(map via Visual Capitalist)

Why it matters:

This wasn’t totally unexpected – it had long been known that other nations were interested in joining. Few, however, anticipated that in one fell swoop the group would more than double its membership numbers, and the list of countries selected has triggered some speculation.

Including the large oil producers seems like a no-brainer. With the entrance of Saudi Arabia, Iran and the UAE, the group now controls more than half the world’s oil exports and a significant portion of its oil finance flows.

What is surprising is that Indonesia was not included, given the heft of its economy, its geographical location and the strategic importance of its oil production. It turns out that Indonesia’s prime minister, who had travelled to South Africa for the summit, had requested some time to consult with other strategic partners. It’s probably not a coincidence that, on Thursday, Indonesia’s defence minister was at the Pentagon. This shines an even harsher light on Saudi Arabia’s eagerness to join, given its traditional military ties to the US which are feeling somewhat weaker these days.