Two AMRO economists warn that American dominance in artificial intelligence (AI)-linked energy, infrastructure, production, and payment rails can lead to a renewed dollar hegemony period through stablecoins. While other options also surge as drivers of this economy, stablecoins might be favored due to early network effects.
Key Takeaways
AMRO economists argue pricing AI compute and infrastructure in dollars could trigger a new dollar loop.Dollar-pegged stablecoins could become the default programmable money for automated AI agent payments.Asian nations are urged to develop local digital currencies and data centers to limit dollar reliance.Two economists from the ASEAN+3 Macroeconomic Research Office (AMRO) suggest that the winner in the artificial intelligence (AI) race will not be the nation with the most powerful model, but the nation that manages to establish the currency that these models – and the infrastructure around them- will be based upon.
The thesis behind this premise is simple: if companies need to pay for all things AI with dollars, and AI becomes a far larger industry than it is today in money volume and relevance, a renewed global demand for dollar liquidity will surge. They identify this element as the first channel for AI-dollar domination.
The two channels might coincide, as agentic systems might settle AI-linked compute payments in stablecoins, establishing a positive dollar loop difficult to escape.
While stablecoins are not the only dollar proxy available, these might benefit from early network effects, as they are already available to play this role in the AI economy, as tokenized deposits of central bank digital currencies (CBDCs) are still not ready for this task.
This would have a secondary effect that would also benefit the U.S.: an increased demand for U.S. Treasuries used as collateral to support the growing stablecoin market capitalization.
The report calls for ASEAN+3 nations, including Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam, China, Japan and South Korea, to limit their dependence on this dollar loop.
Establishing regional data centers and developing tokenized forms of money based on local currencies could help avoid strengthening the stablecoin AI bond and help these nations to participate in the AI economy without indirectly supporting a new layer of AI dependence.
