🌐 Geopolitics: Global Reserve Currency

The Chinese yuan’s incremental penetration into global reserves has stalled, according to a Peterson Institute study that noted a flattening in foreign‑exchange reserves held in RMB. The slowdown reflects both China’s tightening capital controls and a lack of fully convertible status, limiting the currency’s appeal for international trade and investment. Meanwhile, the WSJ op‑ed argues that the U.S. dollar’s entrenched dominance continues to shape global economic policy, giving Washington a strategic advantage in setting financial standards and collecting seigniorage. For crypto markets, a stalled yuan expansion reduces the likelihood of a near‑term shift away from the dollar in cross‑border payments, keeping fiat liquidity high and risk appetite moderate. The continued dollar hegemony also supports stable demand for crypto‑assets as a hedge, but any future move toward a multi‑currency reserve basket could increase volatility in fiat‑crypto conversion rates and regulatory scrutiny in jurisdictions seeking to align with new reserve frameworks.