Housekeeping: We are offering a week free to Premium subscribers. We hope you see the value.
Russia Just Told You The Ruble is Implicitly Backed by Gold and Bitcoin
UPDATE: 11:54 a.m. AND NOW THIS
In order to balance supply and demand in the domestic precious metals market, the Bank of Russia will buy gold from credit institutions at a fixed price from March 28, 2022.
After the specified period, the purchase price of gold can be adjusted taking into account the emerging balance of supply and demand in the domestic market.
Intro: We are not given to hyperbole. This is a path we’ve studied for years as students of history. This is not a fomo panic buy (or sell) statement. It is a geopolitical observation.
There comes a point where no matter how good a captain is, after which, he cannot steer his ship to avoid an iceberg. The dollar is on a collision course with China and Russia on trade. If the iceberg does not melt, the choices are: crash, or scuttle with the affluent surviving in lifeboats.
The following was reported yesterday. The implications are geopolitically staggering. We hope our governments are paying close attention.
Russia is open to accepting bitcoin for its natural resources exports, the chairman of the country’s Congressional energy committee, Pavel Zavalny, said in a press conference on Thursday. BitcoinMagazine via Zerohedge
As part of the pushback by Russia from western trade sanctions and restrictions in using SWIFT, Russia has had to openly accept alternative payment methods and systems for its assets. A large part of that solution is using Gold and Bitcoin for Trade.
Dollar Death by A Thousand Cuts
The article is viewed rightfully by some as an overplay on the significance of the Bitcoin inclusion beside Gold as an alternative payment. Though this is true, the long term effects are potentially a cascade of currency rebellions. Death of a thousand Bitcoin transactions, if you will.
Even if the smallest country with the weakest currency were to use it, the stage is now set for broader adoption and decentralized payments taking over what was once a system exclusively denominated by dollar transactions. There is a choice now and it is going to further destabilize global trade.
Fast forward to today and people are now asking what to make of the revelation that Russia is beginning to implement something it and China have been working on for years. What does it mean? Today’s GoldFix Podcast focuses almost exclusively on the implications of these announcements in context of the above, and going forward. Here are the most relevant 2 minute clips broken out:
Clip 1: Russia accepting Gold ( and bitcoin) for Nat Gas. Why it is bullish for those assets. What does that say about the Ruble? What does that say about physical vs futures?…
Russia accepting Gold ( and bitcoin) for Nat Gas pic.twitter.com/P4XKi1vYaf— VBL (@VlanciPictures) March 25, 2022
Clip 2: Russia announces Gold and Bitcoin for Natural Gas. Ruble is now at least implicitly backed by Gold and Bitcoin….
Ruble now at least implicitly backed by Gold and Bitcoin (dollars) pic.twitter.com/yURuHXSOdX— VBL (@VlanciPictures) March 25, 2022
Why Gold and Bitcoin are Valid for Russian Trade…
Why Gold and Bitcoin are Valid for Russian Trade pic.twitter.com/oKz6dXwYRj— VBL (@VlanciPictures) March 25, 2022
The risk of This announcement to Bitcoin and Gold…
How the West Will push back pic.twitter.com/u3QQ6LPw90— VBL (@VlanciPictures) March 25, 2022
The Bitcoin Maxi thesis in real life…
BTD if you are a maxi pic.twitter.com/ZxTGv1rmq1— VBL (@VlanciPictures) March 25, 2022
Full podcasts can be listened to HERE
They’ve Been Working on This Since 2017
In 2017 it was reported to us that Russia had been doing oil for Gold deals with China using Blockchain for the Gold verification. The Gold stayed in China’s Shanghai exchange. From my September 3, 2017 post entitled Golden Yuan: Crude Backed By Gold is Here
Deals are being done, Russia/china oil for gold using Blockchain over the past several months. A few months ago $3b trades that way. And the info I got was that the gold paid to Russia never left the Chinese vault.
While this was never verified in the media we did notice this in a 2019 Reuters article and concluded the likelihood of the testing being successful was very high:
MOSCOW, March 19 (Reuters) - Russian lawmakers on Tuesday backed the international use of a Russian alternative system for the global financial messaging network SWIFT designed by Moscow to eliminate the risk of Western sanctions.
“As the system has proved to be viable and efficient, it draws interest from both Russian and foreign players, it is proposed to give any legal entities, Russian and foreign, the possibility to use it,” Aksakov said.
Russia has held talks with China, India, Iran and Turkey about joint use of Russia’s financial messaging system…
Watch how this plays out over the next 2 years. Either the west has to hoard it faster ( they are), spoof it lower (they have been), or both. We think both. We are Gold traders after all.
We are also Americans and do not want this to remotely succeed on Russian and Chinese terms. We want sound money in any form. But not Sino-Russo rule. But that is a real risk.
- When do Gold & Silver Futures Spreads Warn of a Squeeze?
- Weekly: Gold, Goldman on the Vixx Debacle, and More
- Post Fed | Banks Predict Ten or Eleven More Hikes
- SPECIAL: China's "Do-Nothing Approach Keeps Russia on Life Support"