China Shifts Away from Dollar-Backed Assets: Is Bitcoin the Next Target?

China is taking a decisive step towards diversifying its holdings by decreasing U.S. Treasury bonds and increasing gold reserves. This change signals a growing distrust in the stability of the dollar and a desire to hedge against potential economic risks. The People’s Bank of China has steadily added gold to its reserves for over 17 months, reflecting a long-term confidence in precious metals over U.S. government debt. China now holds less than $800 billion in Treasuries, the lowest level in a decade. This shift towards gold and away from dollar-denominated assets appears aimed at bolstering their stability against geopolitical uncertainties and potential currency devaluation. Some experts are suggesting that the U.S. take a similar approach by investing in Bitcoin as a way to secure financial resilience in a world of rising global debt and currency volatility. Supporters believe Bitcoin’s portability, fixed supply, and resistance to inflation make it a suitable countermeasure to these issues.