China Throws Weight Behind BRICS Expansion, Eyes Bitcoin

• The Chinese government is behind the driving force behind BRICS.
• The group is in search of an alternative currency to the US Dollar and Bitcoin is a candidate.

China has announced its intention to support the BRICS’ (Brazil, Russia, India, China, and South Africa) major plan to expand the five-member grouping with “like-minded partners”. 

Mao Ning, the Chinese Foreign Ministry representative, declared during a briefing that China always holds that BRICS is open and inclusive, therefore, the country is ready to throw its weight behind the decision. Markedly, Ning made this bold statement in response to Nicolas Maduro’s effort to add Venezuela to the group. Maduro is the sitting president of Venezuela. Brazil’s current President Luiz Inácio Lula da Silva has shown support for the admission of Venezuela. 

BRICS is a grouping of emerging economies, cutting across different continents of the world. The platform was founded in 2001 and at that time, it was referred to as BRIC coined by Goldman Sachs economist Jim O’Neill.

It wasn’t until 2010 when the last member; South Africa, joined and it became BRICS. Its first summit was held on June 16th, 2009. From that time till now, many countries including Saudi Arabia, Iran, Argentina, the United Arab Emirates, Algeria, Egypt, Bahrain, Indonesia, two unnamed East African nations, and one unnamed West African nation have indicated interest to join the group.

BRICS Considers Bitcoin As Alternative to Dollar

Some of the key objectives of the platform are to enhance economic cooperation and trade among the member countries and promote sustainable development and inclusive growth. BRICS also facilitates political cooperation and mutual understanding among member countries. One major focus of the platform has been to examine the possibility of creating a new common currency and depopularizing the United States dollar.

Some member countries have been contesting the level of dominance of the dollar for their transactions. At the same time, they are also concerned about the advantages, disadvantages and complexities involved in implementing such a significant economic change. Naledi Pandor, South Africa’s Minister of International Relations and Cooperation acknowledged that the topic had to be agreed upon by other members. 

Anatoly Aksakov, Chairman of the State Duma Committee on the Financial Market in Russia believes that there is a possibility for discussions about a new currency to materialize sometime this year. The search for an alternative to the U.S. dollar is fast gaining attention as other countries have also shown interest. Saudi Arabia and Iran have made tremendous efforts to shift their country’s dependence on the dollar.

In the bid to move towards “de-dollarization”, Bitcoin (BTC), the largest cryptocurrency by market capitalization is becoming the most talked-about alternative. The preference heightened during the recent price rally of the token. As the next BRICS summit draws closer, there are talks that the agenda may include BTC integration. Currently, Bitcoin is trading at $25,970.98, indicating a 0.65% gain in the last 24 hours 

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