The Daily Peg
Statecraft and petrodollars dominate today's agenda, while the Atlanta Fed gets nostalgic for the 'Chicago Plan' — casting stablecoins as a return to narrow banking.
Editorial hello
The Peg continues to iterate through April as it gears up to its key make-or-break moment. The intent, as ever, is to bring you essential aggregation, alongside original analysis and insight, plus executive interviews. For now, there’s only one of me, so original content is still in bootstrap mode. But I assure you, high-quality new content is incoming.
In the meantime, I thought it might be useful to add a succinct daily editorial note, if only to highlight that all the content is personally curated and that I take pains to pluck out the news that matters.
On that front, today’s defining theme is dollar statecraft.
Venezuela — currently in the process of re-connecting to the dollar system — has binned its central bank governor, Laura Guerra. This comes as the Bank cozies up to US authorities in the hope of opening the Venezuelan economy to investment by introducing new legal frameworks for mining and energy projects. For all the talk about the death of the petrodollar, the picture in parts of South America looks far more like a quiet revival.
There’s also a must-read for those of you who enjoy stablecoin statecraft and a bit of eurodollar reminiscence. It comes via the Bitcoin Policy Institute and goes deep on global currency power play, with some particularly interesting observations on the dollar as a global public good and on how SOFR has altered the incentive structure for offshore institutions that benchmark to the dollar. The institute’s core argument is that the US should use stablecoin regulation to reassert the terms on which dollars are created and circulated globally, and in doing so limit the free-riding that has long defined the offshore dollar system.
Finally, one for the legislative watchers: a source tells The Block that the latest draft of the Clarity Act still includes language that would ban rewards on idle stablecoin balances, while allowing yield tied to activity like transactions.
Have a lovely weekend everyone.
