The Role Of US Dollar in Global Trade

[MFahad]

The global trade is becoming more independent and we don't have to see a number of people depending much on the use of Fiat currency when we are already going far in cryptocurrency and this has been a unique opportunity for every actors to make profits in their financial and business Enterprise, with time we will see how bitcoin could also be a mainstream the same way we use Fiat currency as a global coin for international trades and other purposes, even though this is already becoming a reality and we only needed more time to achieve a unified adoption rate to Bitcoin in serving all this purposes.

I would partially agree to this point that crypto-currency especially Bitcoin is becoming more important factor for international trades although bitcoin has changed the way of people thinking about investing money. However, I do not think so that it will replace the Fiat currency in near future because there are still many challenges to face like Government statutes or public policy price fluctuations and limitation of acceptance from many countries. the continuous development of blockchain technology and increasing awareness among peoples in world may help crypto-currency gain wider acceptance in the upcoming years. On the other hand I think in future both currency will serve side by side for there different purposes.

[bitgolden]

In a world where we are dealing with someone who is not from our country, we will always use USD as the benchmarket to calculate the value. I will switch that dollar to my fiat, and the other person will switch that dollar to theirs, and they will all calculate and we will see if it is a good deal or not that way.

I can't offer my fiat, they would not want it, and they won't offer their fiat because I will not take it. This is the reason why bitcoin ends up with being so much more important. Because it can replace dollar.

[slapper]

Oil is first priced in dollars because at a certain point in history enough of the world agreed to that standard. Then all others were forced to adapt or be left out of the market. Once a standard is established it is nearly impossible to change. The costs of replacement are spread across all equally. All the counterparties have to switch simultaneously. That almost never happens.

Gold same thing. Shipping contracts, the same thing. This is not some random selection that was made anew each year. A complex series of choices became entrenched in existing infrastructure, and the infrastructure now penetrates deeper than any one political will.

The loan thing, it is a real term for that, "original sin". The economists use to describe the trap where developing countries literally cannot borrow in their own currencies. Foreign investors will not be holding them for the long-term. So they issue dollar debt. And then when their local currency falls the debt burden grows. In local terms. While their revenues stayed local.

[CONVOAI]

Many countries are now trying to increase trade in alternative payment systems and their own currencies but it is not so easy to change the position of the USD quickly just by starting a few bilateral agreements or limited transactions. The influence of the dollar in international trade, banking systems, foreign exchange reserves and investment has been built up for many years. Therefore no matter how many alternative systems grow it will take time for them to be globally accepted. The monopoly of the dollar may decrease somewhat in the coming days but it still seems quite difficult to create an alternative to it in the short term.

[DrBeer]

In a world where we are dealing with someone who is not from our country, we will always use USD as the benchmarket to calculate the value. I will switch that dollar to my fiat, and the other person will switch that dollar to theirs, and they will all calculate and we will see if it is a good deal or not that way.

I can't offer my fiat, they would not want it, and they won't offer their fiat because I will not take it. This is the reason why bitcoin ends up with being so much more important. Because it can replace dollar.

This is the key advantage of the DL for EVERYONE-a single unit of value transfer that, while subject to inflation, is not affected by it in the same way as all other currencies in the world.
By the way-what’s stopping other countries from making payments to each other in their local currencies? Think about it! The answer is extremely simple-it’s complicated and… NOT PROFITABLE!!! On the global market, it’s more convenient and profitable to buy with dollars. If a country’s central bank has a "mix" of 150 currencies, how will it buy goods with dollars? That’s right, by selling local currencies for dollars, incurring a loss on every transaction.
Will cryptocurrency change this situation? Probably, but for that to happen, the world’s largest economies would need to start accepting it...

[Fortify]

1. Trade
A) Most countries bill each other in dollars.
B) Oil, gold, wheat = All priced in USD.
C) Most shipping contracts are in USD too.

2. Finance
A) Most international payments use USD.
B) Loans in USD are cheaper.
C) 9 out of 10 currency trades involve USD.

3. Power 
A) Every country needs USD to buy stuff.
B) The US can sanction others by blocking USD.

4. Will it change?
A) China, Russia, India want to use Yuan/Rupee.
B)  But USD is still king and 60% of the world still uses it.

It is changing, slowly, because China wants more independence and less reliance on US debt - they've been a major seller over the last decade which has only escalated since the erratic behavior of Trumps trade wars. Russia for obvious reasons is also cut off from trading in US dollars, not that they ever necessarily wanted to do so anyway. However many other countries still use it as their effective day to day trading currency, even if it's not their official currency. Sometimes it is out of the hands of the government and this happens in a black market, because the citizens don't trust their own currency. There have been many instances of hyper inflation which can devalue other currencies and is much less likely with the wide circulation of the US dollar.

[WillyAp]

 A larger danger for the USD are the stablecoins which are readily available, easy to manage.
For me they are not Crypto but digital FIAT.