Harvard’s Kennedy School conducted a White House National Security Council meeting live simulation on November 19th.
The simulation was called Digital Currency Wars and featured leaders together with senior administration officials that used to be in the office. The event was meant to examine the potential scenario in which North Korea launches a missile test funded with China’s future digital currency.
Options for US to Remain in Power Have Been Discussed
Set in the future, more precisely 2 years from now, the simulation featured the Chinese digital Yuan launch 20 months before the event. This new currency didn’t only end up dominating payments in China, but it was adopted all-over SouthEast Asia too, as it’s easy to use. Included in the game, there’s also a newsflash announcing the North Korean missile test, which takes Washington by surprise with how advanced it is and has been funded through the US sanction avoidance on the use of the Chinese digital currency. Since sanctions are failing, the Security Council is meeting to find solutions.
US Relies on China’s Cooperation
One of the most important points presented was the US’s reliance on Chinese cooperation, having the simulated Treasury Secretary pointing out that:
“We will not successfully starve North Korea economically without the cooperation of China, and certainly not if it is their objective to see us fail.”
The same simulated Treasury Secretary says that in 30 years, the US has never managed to convince China to make use of its leverage. He gets interrupted by another newsflash that reveals a cyberattack in the SWIFT system, with $3 billion missing from commercial banks located in the United Arab Emirates, Saudi Arabia and Germany.
The Recommendations Made to the President
The group recommended the President to take measures against the global economy’s bifurcation. Weaponizing SWIFT didn’t prove to be very effective, even if at some point the meeting discusses how to rely on existing strategies and how to harden the system. More open-minded people attending the meeting said the US needs to have a similar digital currency if it wants its financial power to be regained. The solutions presented were to pressure China for cooperation in a diplomatic manner, to look at North Korea’s sanction breaking by using electronic intelligence or to develop the digital dollar. Military pressure was regarded as a less desirable solution.
The Dollar is Losing Its Dominance
While policymakers in the US are more and more engaging in the blockchain and crypto space, there are a few lawmakers who have asked for regulations when it comes to the blockchain technology and digital assets, saying this is necessary for the country to not fall behind lenient jurisdictions. The blockchain patents in China are now more than 7,000, which is three times more than what’s in the US. Also, the launch of the digital Chinese Yuan is set to happen in the next 6 to 12 months.