23.11.202212:04 Forex Analysis & Reviews: US dollar must be boosted by strong economy

The US economy has to remain strong in order for dollar to maintain its dominance in markets. Although the USD index gained over 12% in a year, thanks to high US interest rates and being a safe haven asset, they are not enough to maintain hegemony.

Most of the effort should be allotted to making the US economy even more vital because benefits, such as dollar becoming the world's reserve currency, will follow naturally. This is actually why some analysts believe that the US seeks to suppress alternative currencies, including Bitcoin. They believe that the US wants to maintain dollar's dominance in order to control world trade.

However, the US should consider using multiple currencies rather than keeping dollar as the unit of account and means of savings because there is a high chance that many alternative currencies will emerge, which could challenge dollar's traditional role as a medium of exchange, unit of account and means of saving.

Of course, it is not certain that central bank digital currencies (CBDC) could monopolize the monetary system, but Blockchain technology will play a prominent role in the definition of money in the future. It could lead to greater decentralization and individual control over money. CBDC will have to compete on its own merits with other alternative currencies.