GEAB 144

While the need for the digitalisation of the international monetary system described earlier is being reinforced by the financial crisis triggered by the pandemic, one finds in many articles on this topic the same fixed idea: allowing the world to bypass the American system of sanctions.[1] Indeed, these digital currency projects do not date back to the pandemic. They are primarily driven by the famous extra-territoriality of American law, made possible by the fact that world trade takes place almost exclusively in US dollars.[2] As an exit from the dollar system was not possible via the current monetary paradigm, only a change in this paradigm allows us to envisage this liberation. This is where the pandemic comes in – making the credibility of a system based on ‘trust’ (‘fiduciary’ currencies,[3] particularly since 1971 and the end of the Bretton Woods agreements) crumble and legitimising the implementation of a new world monetary system not based on the US fiat currency.

But the consequences for the United States will be colossal… especially in terms of its international role, of course. The end of the extra-territoriality of US law via the end of the supremacy of its currency may mean the end of US management of the world. This loss of power carries with it a considerable risk of seeing the United States move from the kind of ‘legal diplomacy’ linked to its currency to more muscled forms[4] of preserving its strategic interests – especially if these ‘strategic interests’ are not redefined to make them compatible with those of the rest of the planet.