He added that Beijing has tried to use the euro in the same way.
Speaking at a virtual event hosted by the Richard Nixon Foundation, Thiel, who is a major investor in virtual currency ventures as well as in cryptocurrencies themselves, said that the US should consider tighter regulations on cryptos.
While commenting on whether China’s central bank-issued digital currency (CBDC) could threaten the US dollar’s status as a global reserve currency, the businessman suggested that an “internal stablecoin in China” will amount to little more than “some sort of totalitarian measuring device.”
He said: “From China’s point of view, they don’t like the US having this reserve currency, because it gives a lot of leverage over oil supply chains and all sorts of things like that.
“Even though I’m a pro-crypto, pro-bitcoin maximalist person, I do wonder whether if, at this point, bitcoin should also be thought-of in part as a Chinese financial weapon against the US, where it threatens fiat money, but it especially threatens the US dollar.”
Thiel also said that China attempted to denominate oil trades in euros in recent years, in a bid to undermine the global standing of the dollar. “I think the euro, you can think of as part of a Chinese weapon against the dollar – the last decade didn’t really work that way, but China would have liked to see two reserve currencies, like the euro.”
The billionaire entrepreneur speculated that Beijing does not actually want its renminbi to become the global reserve currency, claiming that the government would have to “open their capital accounts,” among other measures “they really don’t want to do.”
He said: “China wants to do things to weaken [the dollar] – China’s long [bet is] bitcoin, and perhaps, from a geopolitical perspective, the US should be asking some tougher questions about exactly how that works.”
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