The major benefit of the US Dollar is that you can do things with it. Between export controls, currency controls, laws on foreign ownership, etc, china can pay me all the RMB in the world. I still can’t do a whole lot with it.
This is part of the same reason many people don't use Bitcoin- you can't actually do much with it because retailers don't accept it. But China is definitely thinking about how to fix that problem, and soon they will make it possible to pay directly in CNY in other countries. Once you can buy things with it, the CNY is attractive from a practical perspective. A lot of your stuff is already manufactured in China, once/if using CNY makes your purchase easier then it's going to gain ground on the USD.
Retailers don't accept crypto not because of the technology so much as the fact it is a capital gains event every time you transfer crypto, which means both the buyer and seller are now forced to keep a log of their gains/losses against the dollar everytime they buy a pack of gum.
Obviously that's extremely impractical and at best you're hiring a 3rd party to streamline that for you. It's a clusterfuck at tax time (edit: stable coin doesn't help here -- you must still report gains on stable coins as it is still a $0 capital gain which is different than no capital gain).
Retailers already dealing with capital gains and with high chargeback rates love it though. For instance, it's usually the cheapest same-day clearing way to buy precious metals online since credit card rates are high (chargeback), ACH takes days, and wires tend to cost $15+ with many banks.
Funnily enough you can use Bitcoin at most merchants that use a Square PoS device, which is like 25% of merchants in the US. It just takes time for folks to change their behaviors. And why would they, if they're getting X% cashback on all purchases using their credit cards?
Paying Chinese companies in RMB isn’t the issue. If I sell something and a Chinese company pays me in RMB, I can’t really do anything with a billion yuan. Can’t buy a company (limitations on foreign ownership), can’t buy property (99-year lease that can be canceled on the whims of the government at any time), can’t buy Chinese debt (terrible yields, very small foreign market access, incredibly opaque laws and accounting), and nobody else in the world wants it so I have no choice but to sell it back to China in exchange for a real currency at whatever horseshit exchange rate they’ve concocted.
It’s worthless money and I don’t see anything out of china that would cause that to change.
It's more of a payment processor issue than a device issue.
If you are in a country or area with a large Chinese population, you can usually pay easily in RMB with Alipay.
If you use Visa and Mastercard, you are subject to US regulations, sanctions, and embargoes. Many alternative payment processor exist, PIX in Brazil, UPI in India, etc.
There are several systems in the EU: Wero, Bizum, BLIK
It is urgent that Europeans coordinate to ensure the interoperability of these systems and reduce the influence of Visa and Mastercard.
In the event of conflict, this will be the first service to be cut in order to disrupt European countries.
An integrated European payments system should be very high up on the priorities list of the European Commision. I believe every EU country already has its own version of a QR code payment, I don't know why can't they connect "easily" connect them.
You can buy with RMB in a lot of countries outside the West, if they have integrated UnionPay or AliPay into their payment processors.
But more importantly, you can buy a lot of stuff from the factory of the world. Which is why a lot of countries don't mind holding the RMB. Just not enough for it to become a reserve currency, and certainly no one wants it to become the petroyuan.
parsimo2010|1 month ago
https://www.atlanticcouncil.org/blogs/econographics/what-to-...
mothballed|1 month ago
Obviously that's extremely impractical and at best you're hiring a 3rd party to streamline that for you. It's a clusterfuck at tax time (edit: stable coin doesn't help here -- you must still report gains on stable coins as it is still a $0 capital gain which is different than no capital gain).
Retailers already dealing with capital gains and with high chargeback rates love it though. For instance, it's usually the cheapest same-day clearing way to buy precious metals online since credit card rates are high (chargeback), ACH takes days, and wires tend to cost $15+ with many banks.
kevinak|1 month ago
selectodude|1 month ago
It’s worthless money and I don’t see anything out of china that would cause that to change.
tayo42|1 month ago
Beretta_Vexee|1 month ago
If you are in a country or area with a large Chinese population, you can usually pay easily in RMB with Alipay.
If you use Visa and Mastercard, you are subject to US regulations, sanctions, and embargoes. Many alternative payment processor exist, PIX in Brazil, UPI in India, etc.
There are several systems in the EU: Wero, Bizum, BLIK It is urgent that Europeans coordinate to ensure the interoperability of these systems and reduce the influence of Visa and Mastercard.
In the event of conflict, this will be the first service to be cut in order to disrupt European countries.
The US already use it for coercing European politicians : https://www.courthousenews.com/eu-strongly-condemns-us-sanct...
tdrz|1 month ago
fakedang|1 month ago
But more importantly, you can buy a lot of stuff from the factory of the world. Which is why a lot of countries don't mind holding the RMB. Just not enough for it to become a reserve currency, and certainly no one wants it to become the petroyuan.