Jim Rickards has spent decades at the intersection of intelligence, finance, and geopolitical strategy. He was involved in building the petrodollar system in the 1970s.
That’s why what he said this week is especially interesting.
Discussing which currency Iran may be using to collect reported Bitcoin tolls from oil tankers passing through the Strait of Hormuz, Rickards paused before answering. “It could be Bitcoin. It could be Tether. It could be Ripple.”
He cited Ripple, along with Bitcoin and Tether, as a leading medium for sovereign energy payments.
Context matters
Rickards was discussing a breaking report in the Financial Times that Iran has started demanding payment in cryptocurrency from ships passing through the Strait of Hormuz. The original report did not specify the exact currency. Rickards was considering logical candidates in real time.
His analysis went beyond simply naming currencies. He noted that regardless of which cryptocurrency Iran uses, it still prices its fees in dollars. $1 per barrel of oil is a dollar-denominated transaction settled in cryptocurrencies, not an escape from the dollar system.
“You can go after the dollar, but you can’t run away from the dollar,” he said. “Cryptocurrencies have equivalents to the dollar, so no matter how much people try to escape from the dollar, they always end up going back to it.”
He also raised pointed questions about Tether in particular. The largest stablecoin by market capitalization counts U.S. Secretary of Commerce Howard Rutnik as a key investor. If Iran is paying its oil bills with Tether, it is likely routing payments through means directly connected to the U.S. government it is trying to circumvent.
“Is Iran going to use Tether? Is it going to charge for Tether’s oil?” he said, the sarcasm telling it all.
Why Ripple is important in this conversation
Supporters say Ripple’s inclusion on Rickards’ list was no coincidence. $XRP and $XRP Ledger is specifically designed for fast, low-cost cross-border payments between institutional investors. Transactions complete in 3-5 seconds. The network has over 300 financial institutions using its payments infrastructure.
It is unclear whether Iran is actually using Ripple. Rickards was speculating, without confirming it. But the fact that a former CIA contractor and one of the architects of the petrodollar system turned to Ripple as a natural answer to the problem of an alternative to dollar-denominated oil payments is a noteworthy data point.
