by: The Washington Eye
Currency is one of the most significant inventions in human history, yet many of us overlook its importance in our daily lives. At first glance, money seems simple—coins in your pocket, bills in your wallet, or digital numbers in a bank app. But beneath its surface lies a complex system of trust, governance, and economic coordination. Currency works because people believe it works. It is not just a tool for buying and selling; it is a shared agreement among individuals and institutions that a certain object—whether paper, metal, or digital code—holds value and can be exchanged for goods and services.

Before currency came into existence, human societies relied on the barter system. In barter, people exchanged goods and services directly. This method, while natural in small communities, had major limitations. It required a double coincidence of wants: both parties had to want what the other had. If you had wheat and wanted shoes, but the shoemaker didn’t want wheat, you couldn’t trade. Currency solved this problem by serving as a universally accepted medium of exchange. Early currencies included commodities like salt, cattle, or gold—items considered valuable and difficult to fake. Eventually, these evolved into coinage and paper money, often backed by physical commodities such as gold and silver. In modern times, we use fiat money, which has no intrinsic value but is declared legal tender by governments and accepted because people trust the system behind it.

Today, central banks and financial institutions manage currency through complex tools like interest rates, inflation targeting, and money supply regulation. When handled well, these tools can stabilize the economy, foster investment, and generate employment. But mismanagement—such as excessive money printing—can lead to disastrous consequences, including hyperinflation. Historical examples like Zimbabwe or Venezuela demonstrate how quickly a currency can become worthless when public trust is lost. Without faith in currency, prices skyrocket, savings vanish, and economies collapse.

Now imagine a world without currency. Would we return to barter? Perhaps, but that would bring back the same inefficiencies that currency was invented to solve. More likely, alternative systems would emerge. These could include commodity money like gold or oil, decentralized digital currencies such as Bitcoin, or even systems of social credit or labor exchange. Each of these, however, has its flaws. Cryptocurrency, for example, promises decentralization but remains volatile and vulnerable to speculation. Commodity money might favor nations rich in resources and deepen inequality. Social credit systems, while potentially fair, could also become tools of control and surveillance.

A world without currency would likely cause global trade to collapse. Currency provides a common unit of account that allows us to price goods, calculate profits, and manage contracts. Without it, international transactions would become chaotic. Supply chains would stall, and financial markets would lose their foundations. Moreover, debt and long-term contracts rely on stable money. Without currency, these agreements lose meaning. Lending would slow down, investments would halt, and the global economy would become stagnant.

Some idealists imagine a future where money is no longer needed—where technology, automation, and abundance make everything freely accessible. In such a society, resources could be distributed based on need rather than ability to pay. This vision, promoted by movements like The Venus Project, presents a post-currency economy guided by logic and sustainability. But achieving this would require more than technological advancement. It would demand a radical transformation in human behavior, moving from competition to cooperation, and from ownership to shared access. Such a shift, while theoretically possible, is not likely in the near future.

Ultimately, the question is not whether we can eliminate currency, but how we can use it more equitably. As the world becomes increasingly digital, currencies will continue to evolve—through blockchain, central bank digital currencies, and global financial reforms. But the fundamental role of currency as a tool for coordination and trust will remain. Rather than dreaming of a currency-free utopia, our focus should be on building systems that make currency work for everyone, not just the privileged few. Currency is not just about money; it is about meaning, fairness, and the structure of our economic lives. Without it, society as we know it would unravel.

The Strait of Hormuz, a narrow but strategically vital waterway situated between Oman and Iran, plays a crucial role in global energy security. It serves as the main passage for oil and gas exports from the Persian Gulf, making it one of the most important chokepoints in the world. About 20.5 million barrels of oil pass through the strait every day, representing roughly 30% of the world’s seaborne oil trade. Despite being only about 33 kilometers wide at its narrowest point, its economic and geopolitical importance far outweighs its size. Countries like Saudi Arabia, Iraq, the UAE, Kuwait, and Qatar all rely on this route to ship their oil and gas to international markets, especially in Asia and Europe.

The strait lies between Iran to the north and the Musandam Peninsula of Oman to the south. While both countries have coastlines along the strait, Iran exerts more influence over the waterway due to its military presence and strategic posturing. Iran’s Islamic Revolutionary Guard Corps (IRGC) regularly patrols the area, and Tehran has repeatedly asserted that it has the capability to control or even block the strait if provoked. On the other side, Oman has traditionally maintained a neutral stance and played the role of mediator during times of tension. The United States and its allies, recognizing the strait’s global significance, maintain a strong naval presence in the Persian Gulf. The U.S. Navy’s Fifth Fleet, based in Bahrain, is tasked with ensuring maritime security and safe passage for commercial vessels, particularly oil tankers.

Tensions in the region have surged several times over the past decade, with Iran often threatening to shut down the strait in response to Western sanctions or military actions. In recent months, the situation has again become volatile. In June 2024, Iranian officials warned that they might consider blocking the strait if the country’s sovereignty or economic interests were threatened, particularly in response to renewed U.S. sanctions and Israeli military actions in Syria. The Iranian Revolutionary Guard conducted several naval exercises near the strait, and satellite images showed an increased number of Iranian patrol vessels in the area. The U.S. Navy also reported drone flyovers and near-encounters with Iranian vessels, further escalating tensions.

Although Iran has never fully closed the Strait of Hormuz, even the suggestion of such a move has serious consequences. Markets are highly sensitive to instability in this region. In June 2024, crude oil prices surged nearly 7% in a single day following Iran’s warning and military movements near the strait. A complete closure would likely result in oil prices skyrocketing to over $150 per barrel, causing inflation and potential recession in multiple countries. Asian economies like Japan, South Korea, China, and India — all heavily reliant on Gulf oil — would be especially affected. Although alternative routes exist, such as pipelines through Saudi Arabia and the UAE, their capacity is limited and cannot fully replace the shipping volume of the strait.

The global response to Iranian threats has been swift and firm. The United States has declared that any attempt to obstruct the Strait of Hormuz would provoke a strong military reaction. European allies, including the United Kingdom and France, have also deployed additional naval assets to the Gulf region. Insurance costs for tankers passing through the strait have spiked, and several shipping companies have started rerouting vessels or delaying shipments out of caution.

As of June 2025, diplomatic efforts to calm the situation remain stalled. Iran’s nuclear activities have intensified, and talks to revive the 2015 nuclear deal have made little progress. The International Atomic Energy Agency (IAEA) has raised alarms about Iran’s uranium enrichment levels, while the U.S. has expanded sanctions targeting Iran’s energy and defense sectors. Oman, acting as a regional mediator, has called for restraint and offered to host negotiations, but no concrete steps have been taken. Meanwhile, international observers are closely monitoring the situation, aware that the strait remains a potential flashpoint that could spiral into a broader conflict.

The Strait of Hormuz is far more than just a narrow waterway — it is a strategic artery for the global economy. Any disruption to its functioning could trigger energy crises, economic instability, and even military conflict. The current tensions surrounding Iran and its control over this crucial passage serve as a stark reminder of how fragile global energy security can be in a region fraught with political instability and longstanding rivalries. As the world grapples with these uncertainties, maintaining open access to the strait remains a top priority for global peace and economic stability.

For decades, the U.S. dollar has reigned supreme as the world’s primary reserve currency. It serves as the bedrock of global trade, investment, and finance. From oil pricing and international loans to foreign reserves and cross-border settlements, the dollar’s dominance is unmatched. This monetary supremacy is not simply a reflection of America’s economic strength, but also of the deep trust placed in its institutions, transparent markets, and political stability. In contrast, China’s yuan—despite the country’s rising economic power—remains a distant challenger. As China continues to rise on the global stage, the question arises: Can the yuan realistically overtake the dollar and lead the world economy? As it stands today, the answer remains no, though the future could bring significant shifts.

The Chinese government has taken several strategic steps to internationalize the yuan. These include establishing bilateral currency swap agreements with more than 30 countries to reduce reliance on the dollar in trade, launching the Belt and Road Initiative (BRI) which encourages trade and infrastructure development in yuan, and investing in digital finance through the development of a central bank digital currency (e-CNY). In 2016, the International Monetary Fund included the yuan in its Special Drawing Rights (SDR) basket, symbolically recognizing it as a global reserve currency alongside the dollar, euro, pound, and yen. These are not minor achievements—they indicate China’s intent and its global ambition to shape the future financial order.

However, currency leadership requires more than economic ambition. It requires deep, open, and trusted financial markets, a predictable legal system, political neutrality, and full convertibility—areas where China falls short. The Chinese economy, while the world’s second-largest, operates under heavy state influence. Capital controls are still in place, meaning money cannot freely move in and out of the country without regulatory oversight. This makes the yuan unattractive for investors and central banks who seek liquidity, legal security, and freedom from political interference. Furthermore, China’s legal and regulatory systems lack transparency, and decisions are often guided by political priorities rather than market principles. This undermines the confidence required for a currency to be globally dominant.

Trust is the single most crucial factor in currency power, and the yuan faces a significant trust deficit. The U.S. dollar, despite America’s political dysfunction or economic imbalances, still benefits from the world’s trust in its institutional integrity. Central banks, investors, and businesses feel safer holding dollars because they can access it anytime, anywhere, and under stable legal conditions. In contrast, China’s political system is opaque, and financial decisions can be arbitrarily reversed or influenced by the Communist Party. The fear that the Chinese government could freeze assets or impose sudden policy shifts makes global actors hesitant to fully embrace the yuan.

Geopolitics also plays a central role. The U.S.-China rivalry, along with sanctions and rising protectionism, has further complicated China’s push for a global yuan. While China has successfully convinced some partners—such as Russia and certain Gulf nations—to settle energy deals in yuan as part of a dedollarization effort, these instances remain isolated and strategic rather than systemic. The dollar, by comparison, is embedded in every corner of the global financial system. Most global commodities are priced in dollars, and the vast majority of international financial transactions pass through dollar-denominated accounts.

Looking ahead, the possibility of a multipolar currency world is more realistic than the yuan completely overtaking the dollar. As global power fragments and countries seek alternatives to mitigate risk, the yuan may increase its share in global trade and finance, especially among countries skeptical of U.S. dominance. However, a currency does not gain global leadership simply through political will or economic size—it must be earned through consistency, legal clarity, and open institutions. Unless China radically reforms its financial governance, ensures full convertibility, and builds long-term trust with the world, the yuan is unlikely to replace the dollar as the global leader.

In conclusion, while China’s efforts to expand the yuan’s international role are deliberate and growing, they are still constrained by structural and political limitations. The U.S. dollar’s dominance, deeply rooted in institutional credibility and global trust, will not be easily displaced. The yuan may rise in influence, particularly within China’s sphere, but as things stand, it is not yet equipped to lead the world. Currency power is not just about economic heft—it is about trust, transparency, and openness, all of which remain significant challenges for China.