BlackRock’s Jay Jacobs notes China’s accelerated diversification from dollar reserves amid U.S. sanctions, while Bitcoin’s correlation with gold reaches 0.78 as crypto-AI sector grows 34% YTD per CoinMetrics data.
U.S. sanctions on Chinese banks and BRICS’ gold-backed payment system proposal have catalyzed historic shifts in global reserve strategies, with Bitcoin emerging as a technical safe haven amid AI-driven crypto innovations, BlackRock’s Head of Thematic Strategy revealed this week.
Geopolitical Tremors Reshape Reserve Dynamics
BlackRock strategist Jay Jacobs identified the U.S. Treasury’s 10 June 2024 sanctions against Bank of China, China Construction Bank, and Industrial Bank as the immediate catalyst for accelerated de-dollarization. This followed Russia’s Central Bank confirmation of a 20% reduction in dollar holdings since 2022, redirecting reserves to yuan and crypto infrastructure partnerships with Iran.
Gold-Backed BRICS System Gains Momentum
The bloc’s 12 June announcement of a Q4 2024 target for a gold-based settlement system coincides with China reporting 18 consecutive months of gold accumulation. World Gold Council data shows a 1.2% May increase, bringing Beijing’s reserves to 2,264 metric tons.
Bitcoin Technicals Mirror Gold’s Historical Trajectory
CoinMetrics data reveals Bitcoin’s correlation with gold reached 0.78 on 15 June – its highest since June 2023 – while its Nasdaq correlation fell to 0.32. Goldman Sachs reported $15.7B in institutional BTC ETF inflows on 13 June, highlighting growing institutional acceptance.
AI Compute Demand Fuels Crypto Sector Growth
Render Network’s tokenized GPU marketplace surged 41% this week, driving the crypto-AI sector’s 34% YTD growth. The project now facilitates $6B in decentralized computing transactions annually, per CoinGecko analysis.
Historical Parallels: From Petro-Yuan to Crypto Infrastructure
China’s current reserve strategy echoes its 2018 petro-yuan futures launch that initially challenged dollar dominance in energy markets. Similarly, Russia’s 2022 pivot to yuan reserves following Ukraine-related sanctions established infrastructure now being adapted for crypto settlements.
Precedent: Mobile Payments Paved Way for Digital Asset Adoption
The current crypto-AI convergence mirrors Alipay and WeChat Pay’s 2010s transformation of Chinese commerce. Those systems processed $17T in 2023 – a digital foundation enabling today’s AI-driven personalization and blockchain-based asset tokenization.
