Smart Money: How digital currencies will win the new Cold War – and why the West needs to act now

A FINANCIAL TIMES ECONOMICS BOOK OF THE YEAR 'An excellent book' Vince Cable | 'A must read' Jo Johnson | 'A fascinating read' Bill Dudley A timely manifesto on how digital currencies will win the New Cold War and the struggle for geopolitical supremacy in the twenty-first century. A New Cold War is underway. Whereas the first Cold War was dominated by the threat of nuclear conflict, the new front line is economic and financial, but still dominated by technology. Who controls its future will help decide the outcome of the geopolitical struggle between China and the US. Since the end of the Second World War, the US dollar has been the global reserve currency, which has ensured American dominance of the world economy. But no longer. More than a hundred countries are developing Central Bank Digital Currencies (CBDCs), digital equivalents to cash that will utterly transform how we do business at home and abroad. China was the first country to recognise the potential of this new money. The West's media focused on the new currency's role in China's surveillance state, creating widespread concern about all CBDCs. But they have largely overlooked a more important aspect of its existence: as a tool through which to 'de-dollarise' the developing world at the speed of light. When China's President Xi Jinping officially launched the digital yuan in February 2022, he also agreed a pact of 'limitless co-operation' with Russia. Within days, Russia launched its war on Ukraine, secure in the knowledge it could bypass US sanctions. Urgent, clear-eyed and groundbreaking, Smart Money shows us how CBDCs are going to impact all of our futures in ways that most of us have failed to even consider. If the West is to compete, it needs to act fast to develop its own global digital currencies that reflect the values of liberal democracies. Cover Half Title Title Copyright Contents Introduction Part I Old Money, New Money and Smart Money 1 The Washington Consensus 2 The Dragon Awakens – the Rise of China 3 The New Era of Money 4 Smart Money 5 The Fault-lines of De-dollarisation 6 The Lost Decade 7 Weeks When Decades Happen Part II Smart Money in a Bipolar World 8 What’s at Stake? 9 Digital De-dollarisation 10 The Battle for Resources 11 Flashpoints and Proxy Wars 12 Cyberspace 13 The Wrong Conversation 14 What Should the West Do? Conclusion Notes 1 The Washington Consensus: 2 The Dragon Awakens – the Rise of China: 3 The New Era of Money: 4 Smart Money: 5 The Fault-lines of De-dollarisation: 6 The Lost Decade: 7 Weeks When Decades Happen 8 What’s at Stake? 9 Digital De-dollarisation: 10 The Battle for Resources: 11 Flashpoints and Proxy Wars: 12 Cyberspace: 13 The Wrong Conversation: 14 What Should the West Do? Conclusion Bibliography Acknowledgements