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By: Mohamed Allam

Most people assume that regulation and government adoption will be the biggest catalysts for crypto’s mainstream use. And while those factors will play a major role, the real shift may come from something much bigger—tariffs and foreign policy decisions that push nations to move away from the U.S. dollar. As global trade relationships fracture and countries seek alternatives to USD settlements, the financial landscape is shifting toward state-backed CBDCs and decentralized digital assets as practical alternatives.

I wanted to not that I’m just observing what’s happening. I don’t care if it’s Trump, Biden, or George Washington in office—this isn’t about politics. It’s about watching how the global financial system is shifting in real time. The West is once again playing the tariff game, the dollar is losing ground, and global debt keeps climbing. The U.S. remains trillions in debt yet continues to fund foreign governments through the IMF and World Bank. This raises the question: who actually benefits? While Washington and Brussels maintain that everything is under control, the reality is that everyday citizens are the ones bearing the cost of an increasingly unstable financial system.

At the same time, these tariffs could unintentionally accelerate the adoption of alternative financial systems, particularly among BRICS nations. Most tariffs are denominated in USD, but if the U.S. increases trade barriers against China, India, or Russia, these countries have more incentive to shift to settlements in yuan, rubles, or even central bank digital currencies (CBDCs).

How Tariffs Undermine the U.S. Economy

1. More Debt, Higher Costs

Tariffs increase the cost of imports, leading to inflation. To counteract rising prices, the Federal Reserve raises interest rates, making it more expensive for the U.S. government to service its debt. With national debt already exceeding $34 trillion, higher borrowing costs only deepen the financial strain.

At the same time, slower economic growth results in lower corporate and income tax revenues. As tax collections decline, the federal deficit widens, requiring even more borrowing.

2. The Dollar’s Grip Gets Weaker

As tariffs make trade with the U.S. more expensive, targeted countries are shifting to alternative payment systems. China and Russia have already started settling trade in yuan and rubles to avoid U.S. sanctions and tariffs. If this trend continues, global demand for USD in trade could decline significantly, weakening its reserve currency status.

BRICS and other emerging economies are also investing in new financial infrastructure that bypasses the dollar as we'veqq talked about before. More trade conducted in local currencies—such as the BRICS currency basket, yuan, or rupee—reduces the need for U.S. Treasuries, impacting the U.S.’s ability to finance its deficits.

The CBDC Endgame: A Shift in Global Power

If the U.S. financial system collapses under the weight of its own debt and the dollar loses global trust, there will only be one clear alternative—CBDCs. Governments will not willingly cede financial control to decentralized cryptocurrencies, so they will push state-backed digital currencies as the new standard.

A failing USD could lead to an accelerated rollout of CBDCs worldwide, shifting global finance into a fully digital, government-controlled system. Paper cash will become obsolete, replaced by programmable money that central banks can track, freeze, or manipulate as needed. The transition from physical currency to CBDCs will give governments even more control over monetary policy, taxation, and economic surveillance. 

At the same time, crypto will no longer be just an investment asset—it will become an everyday necessity. If CBDCs become the norm and cash is phased out, decentralized cryptocurrencies will serve as the only escape from centralized financial control. Stablecoins, privacy coins, and Bitcoin itself could finally become viable alternatives for people seeking a neutral, censorship-resistant financial system.

That’s all for today, folks! As always, connect with me on LinkedIn if you have ideas or suggestions for future newsletters. If you have any opinions on this article be sure to let me know. Until next time!