The world's first Bitcoin crude oil market emerges, challenging the authority of the US dollar

As we all know, no matter which country wants to buy crude oil, it needs to use US dollars. However, this situation may change soon, because the market for buying and selling crude oil with Bitcoin has emerged.

The term "petrodollar" has been widely known since the 1970s. Exchanging crude oil for US dollars has become the main source of income for most oil exporting countries in the Middle East and other regions.

However, the authority of the petrodollar seems to have been questioned recently, and this argument includes a number of reasons. For example, Iran wants to sell its crude oil in the form of euros, and Russian President Vladimir Putin is trying to guide Russia out of the petrodollar "vicious circle".

Among the many speculations, only one seems to be the most tenable, that is, the relationship between Saudi Arabia and the United States is becoming increasingly tense.

Former friends turned enemies

There has always been an unwritten agreement between the United States and Saudi Arabia that the United States is responsible for protecting the security of the Saudi royal family, and in return, Saudi Arabia will price their crude oil in US dollars.

In addition, the Saudi Arabian Riyal and the currencies of the Gulf Cooperation Council (GCC) are both pegged to the US dollar. The dollar's dominance in crude oil pricing has also made it a world-class reserve currency. However, there seems to be something wrong between the United States and Saudi Arabia recently. According to reports:

Relations between the two countries have become increasingly strained after the US Senate passed a bill, the Justice Against Sponsors of Terrorism Act (JASTA), which would allow families of 9/11 victims to sue Saudi Arabia to determine whether Saudi government officials were involved in the attacks.

Saudi Arabia was also irritated by the United States' indifference to former Egyptian President Hosni Mubarak, who was an ally of Saudi Arabia.

The sharp drop in oil prices has also dealt a heavy blow to Saudi Arabia. The British Guardian published its opinion on this:

Britain is the largest crude oil exporter in the Organization of Petroleum Exporting Countries (OPEC), and we need to buy oil at $100 a barrel to cover Saudi Arabia's huge public spending. The International Monetary Fund (IMF) has warned that if Riyadh continues to export crude oil at $50, it will use up all its fiscal reserves within five years unless the government chooses to increase taxes or save spending.

PetroBTC appears?

Assuming the U.S. dollar loses its coveted reserve currency status due to political conspiracy or economic necessity, its replacement is still unknown. One option worth exploring is the cryptocurrency Bitcoin.

Cointelegraph had the opportunity to interview Shannon Lowery, founder of NJUF Investments, whose SecureTradePlatform.com is known as the first Bitcoin crude oil marketplace.

Shannon believes that the value of the dollar is about to fall. Due to the special importance of crude oil trading, all countries need dollars to buy crude oil, so the decline of the dollar will affect the prices of all commodities in the market and will also shake major exporting countries. However, Shannon believes that the crude oil market is not hopeless.

There are commercial interests in the crude oil market, and price speculation should be avoided as much as possible. Currently, buyers and sellers can use Bitcoin to trade crude oil and other energy products because the price of the US dollar is about to plummet.

Bitcoin crude oil market is more profitable

Currently, SecureTradePlatform.com's target customers are still governments and enterprises, but according to Shannon, after the depreciation of the US dollar, commodity trading led by Bitcoin will be more profitable, and more retail investors will participate.

When Cointelegraph asked about SecureTradePlatform.com’s short-term and long-term goals, Shannon responded:

In the short term, our focus is to prevent the global chaos caused by the devaluation of reserve currencies. Our long-term development goal is to provide stable prices for the international economy, facilitate governments and related organizations to designate appropriate investment plans, and establish a fair trading system.

The coming oil apocalypse

In order to support the prices of goods, governments have had to work together. Even some countries that are unlikely to appear in the same frame have shaken hands and made peace, including Iran and Saudi Arabia, Saudi Arabia and Russia.

There is a saying that oil producers are more disgusting than the smoke from the Kuwaiti oil field fires in the 1990s (during the Gulf War, Iraq deliberately set fire to a large number of oil wells when retreating from Kuwait. About 700 oil wells were set on fire and burned for 8 months). The GCC currency is pegged to the US dollar, which means that they cannot have an independent monetary policy. If they still insist on doing so, they must sacrifice their country's further development; but if they break the link with the US dollar, they will once again experience the panic and anxiety after the fire.

For Shannon, the future of the oil market is either Bitcoin or death.

Soon, the Fed's monetary policy will cause chaos in the commodity economy. In short, the main purpose of this market is to avoid some of the upcoming economic activities. I firmly believe that countries that are not protected by the commodity economy will soon fall into economic and social difficulties, just like Venezuela. However, Bitcoin does receive a lot of disdain, which is ironic because Bitcoin is the only antidote to the social unrest caused by the government's own policies.