Bitcoin and the risk to becoming the "oil currency"

[Coyster]

What if the attacks we have been seeing on hardware wallets in recent months were something much more serious and actually linked to this bizarre new narrative? In effect, it could be the only way for the USA to attack Bitcoin.

Now that's a weird conspiracy theory to come up with. Those systems had an obvious flaw/vulnerability and scammers found a way to exploit it, this does not have anything to do with any government. The United States government hodl a lot of bitcoins themselves and they have even advanced a bitcoin strategic reserve policy, why do you think they would want to attack bitcoin, when they are also a "major" hodler of the coin.

[Fortify]

At least over the past year, I have heard people say very often that Bitcoin could be the currency that allows for global oil trading instead of the dollar and eventually, the alternative currencies that the BRICS countries are developing.

But is it really a good idea? Look at what has happened over the past 30 years whenever someone has considered an alternative to the dollar in the oil and gas sector.

Guys, what do you think?

An "oil currency" as you put it needs liquidity and minimal friction in trade. Oil prices change frequently at the millisecond level. It's not going to be replaced by bitcoin, but it's possible it might be replaced by some altcoin or stablecoin. Bitcoin is too slow, cannot handle the volume of transactions required, has variable fees and several other factors that make it an impossible substitute. Bitcoin is good for large cross border payments which is very useful and it still has speculation built in which might make some people rich, but it doesn't have a function in the scenario you describe. Why would countries what to substitute fiat currency payments which have been perfected over many decades, if not centuries, with a vastly inferior alternative? It only makes sense to certain countries forced outside of traditional banking channels (aka sanctioned countries like North Korea) but they still have much better alternatives, even trading for goods is more helpful to them.

[M47AK16]

From the viewpoint of the United States that if they're done accumulating Bitcoin for their Strategic Bitcoin Reserve, they would allow it side by side with the U.S. Dollar.

Because they will HODL a massive amount of Bitcoin in their vaults, then they are incentivized to support it and help bring more utility/adoption towards it.

 

USA would still not be fine with it. Yes, they have a lot of it; they seize Bitcoin from criminals and keep it, so if Bitcoin's price goes up, they would benefit from it. But the benefit they get from Bitcoin going up would be super small compared to how much they would gain from the fact that they would do a lot better and should be focusing on how to grow differently. I get that it would not be something that would be easy to calculate, but if they lose oil dollars to oil bitcoin basically, it would be a lot worse.

Oil should be calculated with dollars for them to gain from it; if it starts to be used with bitcoin instead of dollars, that would hurt the USA  a lot more than what they would earn from bitcoin price going up.

[Plutomanian]

I still see Bitcoin's volatility as an issue and that's why using it for daily commodity pricing might pose as serious concern.
Ultimately, the U.S still wants the dollar as the leading currency and will do anything to keep it that way and that's why Bitcoin becoming an oil currency might be harder than we think.
Instead, Bitcoin supports the role as a reserve asset well, being digital gold and a better standard for self soverignty and control.

Bitcoin volatility is not helping matters and we know how risky it's going to be when we start using it for everyday pricing and secondly it will ruined the swiftness of business and daily day transactions following how everything will be in complete jeopardy following the fluctuation of prices. This is not moving any forward and the earlier we start organizing ourselves and ready for goals, the better.

The coexistence of Bitcoin doesn't limit to exchange of oil or becoming a medium of exchange for oil, Bitcoin can outgrown those potential and become very important for traders and investors. We're talking about a project that doesn't warrant the accessibility or authority from the government to operates.

[Asiska02]

So, is it a good idea to propose Bitcoin as an alternative to the dollar for oil? Of course, Bitcoin has no state or central bank, but it could be subject to severe attacks.

What if the attacks we have been seeing on hardware wallets in recent months were something much more serious and actually linked to this bizarre new narrative? In effect, it could be the only way for the USA to attack Bitcoin.

Guys, what do you think?

These vulnerabilities that the attackers are seeing and taking advantage of will make other nations even more sceptical to actually want to see Bitcoin as a perfect alternative to the dollar. The government of USA wants to always see the US dollar as the best currency to ever exist, why will they now agree and not influence the choice of switch to an alternative that’s decentralized and faced with some attacks that makes it also vulnerable?

The attacks may be coming as a coincidence, but I have never for once think that USA will accept the idea to using Bitcoin in exchange for dollar in oil with how they hold dollar with high esteem as compared to all other countries currency, it will depreciate their currency and bitcoin coming stronger which they won’t want to happen.

[Hamza2424]

All I think about the attacks recently is about bad people are now able to easily see vulnerabilities in things related to cryptocurrencies and not only bitcoin, although those of altcoins are most frequent even before AI become something like this.

Bitcoin is an alternative to fiat. It is not competing. They even kind of serve different purposes in many aspects.

Bitcoin has not been seen as a replacement of the United States dollar. It is not a threat.

BTC is really not a threat to the US dollar anymore because they are printing money on it too. They need demand, and they are getting indirect demand from Bitcoiners. They hate it because their enemy countries, which they have sanctioned from making international payments, are using it to make those payments. Iran and Russia have both done this.

So BTC is the best alternative to the dollar for them, and that's what the US does not like. But these increasing numbers of hacks can be the result of efforts by authorities, although the majority of them are carried out by hackers because they have been using AI smartly and finding these loopholes. Although the biggest impact these hacks have is breaking people's belief and trust in BTC.

We are all already questioning the existence of hardware wallets after Coldcard and Ledger.

[crwth]

I am quite confused about why it is being discussed, but i will look at it as the value of the asset and not just the asset completely because i cannot grasp the idea of it being compared to oil.

In this case, I'm not sure if the regulatory bodies or the ones who would be enforcing rules would like this kind of idea, and if it would be feasible in the first place.

[Taskford]

I am quite confused about why it is being discussed, but i will look at it as the value of the asset and not just the asset completely because i cannot grasp the idea of it being compared to oil.

In this case, I'm not sure if the regulatory bodies or the ones who would be enforcing rules would like this kind of idea, and if it would be feasible in the first place.

Maybe because there's running question in their minds and want to talk about those possibilities.

But actually in real time Bitcoin does not fit to became like that. Because government enforce a system on which USD could dominate.

Aside that Bitcoin is so volatile, this is not backed by any strong state. So most likely those powerful countries benefiting from oil trades, will not allow Bitcoin because it can create some impact on their currency and also maybe stability might get affected to.

Many just think about it as speculative asset, not a currency to use for settlement on valuable commodities like oil.

[IceLincoln]

At least over the past year, I have heard people say very often that Bitcoin could be the currency that allows for global oil trading instead of the dollar and eventually, the alternative currencies that the BRICS countries are developing.

But is it really a good idea? Look at what has happened over the past 30 years whenever someone has considered an alternative to the dollar in the oil and gas sector.

Iraq (2003): In 2000 Saddam Hussein proposed selling oil in euro, causing the euro to appreciate against the dollar. In 2003, the USA invaded Iraq under the pretext of weapons of mass destruction that were never found. The Saddam Hussein regime’s euro account was converted back into dollars before the new government took office.

Libya (2011): Gheddafi proposed halting global oil purchases in dollars and switching to an African currency pegged to gold. At thisp oint, the United States, with France complicity, bombed Libya, kill Gheddafi, and the proposal for the gold dinar was scrapped.

Iran (2026): A proposal is made to sell oil in chinese yuan and indian rupes; then under the pretext of Iran’s nuclear program, the USA bombs Iranian infrastructure and blocks the Strait of Hormuz, so who is without raw materials (like europe) will have to buy them from the USA causing the dollar to strengthen again.

So, is it a good idea to propose Bitcoin as an alternative to the dollar for oil? Of course, Bitcoin has no state or central bank, but it could be subject to severe attacks.

What if the attacks we have been seeing on hardware wallets in recent months were something much more serious and actually linked to this bizarre new narrative? In effect, it could be the only way for the USA to attack Bitcoin.

Guys, what do you think?

What a massive conspiracy theory you’ve got going on here. While I may not completely agree with you, I know the US of A will never do anything out of goodwill and they’re always out to get anyone who stands against them in anyway possible.
The attacks we’ve seen so far on bitcoin are just attacks on the vulnerabilities of the wallet systems, I don’t think there’s more to it. The dollar is the most universal currency and Bitcoin wasn’t meant to replace the dollar.
If there are more evidence to support your theory then we can look into it, for now nothing!.

[pooya87]

In effect, it could be the only way for the USA to attack Bitcoin.

Lets analyze OP's theory from a different angle. Take over (infiltration) instead of attack.

As a matter of fact that's a much bigger risk that needs to be discussed. Attack can be seen, it can be fought with and it will create resistance. Look at the history of US regime's wars. The regime has lost all of them. In Vietnam they got pathetically defeated, in Afghanistan the cavemen crushed them and booted them out, in Iraq they were defeated and even though the situation is still a mess the regime could not achieve its goals, against Iran they couldn't even begin working on their goals and the Iranians dominated them in matter of days...

It will be the same with Bitcoin. If the regime attacks Bitcoin, they will fail since Bitcoin is strong and decentralized. In fact in that sense Bitcoin is like Iran. A decentralized power where everyone knows its role and played it perfectly. Each military unit had its orders and a list of targets to obliterate and when the US regime attacked, these units retaliated and obliterated the US military without needing to receive daily orders from a centralized authority. Similar to nodes on a peer-to-peer network that continue doing their job, enforcing rules and rejecting malicious stuff without needing to receive "orders" from anything centralized.
But what if they infiltrate and take over?
There are lots of examples of such infiltration to install sock-puppets. We all know about Ukraine where they installed a Zionist to fight a proxy war for them with Russia.
Another example is Venezuela. The regime didn't "attack" Venezuela. They infiltrated, found some corrupt power hungry individuals, then only removed what was preventing their take over (ie. the legitimate president of Venezuela) and then installed those corrupt individuals. Now the regime is getting its way and is stealing Venezuelan resources very easily! Throws some money at those corrupt entities and they control Venezuela easily.

I'd say that is a much worse risk we are facing in Bitcoin world. Something I mentioned back when some people were falsely excited when "bitcoin" was namedropped during the last sham elections in the US.
If they manage to infiltrate, install corrupt actors in the developers team, take over a large portion of the hashrate and mining pools, take control of a large portion of the supply and most importantly the market (where the trading volume is), ... then we are in trouble.

They won't need to "attack" bitcoin since they'll control it easily. They may end up centralizing it too. If they manage to do that, then Bitcoin won't pose a threat to their corrupt reign even if bitcoin were to become "oil currency" as OP suggests.
The bold parts are things we should concern us and things we must prevent.

[Wind_FURY]

At least over the past year, I have heard people say very often that Bitcoin could be the currency that allows for global oil trading instead of the dollar and eventually, the alternative currencies that the BRICS countries are developing.

But is it really a good idea? Look at what has happened over the past 30 years whenever someone has considered an alternative to the dollar in the oil and gas sector.

Guys, what do you think?

An "oil currency" as you put it needs liquidity and minimal friction in trade. Oil prices change frequently at the millisecond level. It's not going to be replaced by bitcoin, but it's possible it might be replaced by some altcoin or stablecoin. Bitcoin is too slow, cannot handle the volume of transactions required, has variable fees and several other factors that make it an impossible substitute. Bitcoin is good for large cross border payments which is very useful and it still has speculation built in which might make some people rich, but it doesn't have a function in the scenario you describe. Why would countries what to substitute fiat currency payments which have been perfected over many decades, if not centuries, with a vastly inferior alternative? It only makes sense to certain countries forced outside of traditional banking channels (aka sanctioned countries like North Korea) but they still have much better alternatives, even trading for goods is more helpful to them.

Ser, using it as a currency doesn't actually mean that trades should be done tick by tick in the Bitcoin network. A centralized entity/a clearing house could handle the trades, and then process the clearing daily to reduce market risk.

Plus it's LAUGHABLE to say that it should be done with an altcoin "because speed".

  

[davis196]

Iraq (2003): In 2000 Saddam Hussein proposed selling oil in euro, causing the euro to appreciate against the dollar. In 2003, the USA invaded Iraq under the pretext of weapons of mass destruction that were never found. The Saddam Hussein regime’s euro account was converted back into dollars before the new government took office.

Libya (2011): Gheddafi proposed halting global oil purchases in dollars and switching to an African currency pegged to gold. At thisp oint, the United States, with France complicity, bombed Libya, kill Gheddafi, and the proposal for the gold dinar was scrapped.

Iran (2026): A proposal is made to sell oil in chinese yuan and indian rupes; then under the pretext of Iran’s nuclear program, the USA bombs Iranian infrastructure and blocks the Strait of Hormuz, so who is without raw materials (like europe) will have to buy them from the USA causing the dollar to strengthen again.

Correct me if I'm wrong, but the euro didn't exist as a fully functional currency back in the year 2000. Maybe it existed in a "currency only for the central banks" form since 1999, but I don't remember this correctly. Iraq wasn't that big of an oil exporter back then.
Libya was bombed mostly by France and Italy back in 2011 and the bombing was caused by the beginning of the Libyan civil war, not because Gheddafi had proposed Libyan oil and gas to be sold for an African currency. Libya doesn't have big oil and gas reserves.
Iran used to sell oil and gas for yuan(or even crypto) years before the USA decided to bomb them.
It seems to me that you are oversimplifying global finance and geopolitics way too much.

[Swordsoffreedom]

Correct me if I'm wrong, but the euro didn't exist as a fully functional currency back in the year 2000. Maybe it existed in a "currency only for the central banks" form since 1999, but I don't remember this correctly. Iraq wasn't that big of an oil exporter back then.

In 2000, Iraq wasn't the world's biggest oil exporter, but it was among the countries with the largest oil reserves.

Libya was bombed mostly by France and Italy back in 2011 and the bombing was caused by the beginning of the Libyan civil war, not because Gheddafi had proposed Libyan oil and gas to be sold for an African currency. Libya doesn't have big oil and gas reserves.

When the US invaded Iraq, the reason was supposedly WMDs. But what happened afterward? Once they occupied Iraq, they focused on exploiting its oil.

Same thing with Maduro, they accused him of having links to drug trafficking and terrorism. But after capturing him, they turned to exploiting Venezuela's oil.

You catch my drift?

Libya may not have had the largest oil reserves. But it was Africa's biggest oil producer. What happen when an oil exporter like Libya refuses to use USD and euro, and instead tries to push its own gold backed currency?

Iran used to sell oil and gas for yuan(or even crypto) years before the USA decided to bomb them.
It seems to me that you are oversimplifying global finance and geopolitics way too much.

So you actually believe Iran got attacked because it wanted nukes? Oh please, you can't be serious, lol.

[Cgrexp]

I still see Bitcoin's volatility as an issue and that's why using it for daily commodity pricing might pose as serious concern.
Ultimately, the U.S still wants the dollar as the leading currency and will do anything to keep it that way and that's why Bitcoin becoming an oil currency might be harder than we think.
Instead, Bitcoin supports the role as a reserve asset well, being digital gold and a better standard for self soverignty and control.

Bitcoin volatility is not helping matters and we know how risky it's going to be when we start using it for everyday pricing and secondly it will ruined the swiftness of business and daily day transactions following how everything will be in complete jeopardy following the fluctuation of prices. This is not moving any forward and the earlier we start organizing ourselves and ready for goals, the better.

The coexistence of Bitcoin doesn't limit to exchange of oil or becoming a medium of exchange for oil, Bitcoin can outgrown those potential and become very important for traders and investors. We're talking about a project that doesn't warrant the accessibility or authority from the government to operates.

Volatility is certainly a major challenge in everyday transactions. When the price of an asset changes frequently it becomes difficult for traders and consumers to keep track of, set price and control risk. This has hindered the widespread adoption of Bitcoin as a primary means of everyday purchase. Bitcoin importance is not limited to buying and selling goods. Its fixed supply and the ability to transact without intermediaries give it unique characteristics. Being decentralized no single government or institution can directly control it. Bitcoin’s true potential will depend on how effectively it solves real problems. Not just on the idea of  being an alternative to the traditional financial system.

[Bluedrem]

To be honest, ever since I started studying economics a little, I have stopped considering paper money as a resource. Real resources are those things that most people in the world use, that is, the value of resources is not limited to one country. In that case, we can consider gold, oil or similar things. If you notice, you will see that oil is such a resource that there is no such thing in the world that does not increase in value. Day by day, the petro dollar is being established as the most powerful currency in the world. However, instead of accumulating paper money, those who are smart accumulate all these physical resources that do not reduce their value due to inflation, but the value of paper money is determined by these resources.