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Perhaps I'm guilty of being US-centric in my views but I was truly surprised to see this list show that CNY has more 'market cap' than USD.

jeppebemad 5y ago
With China’s population being more than 4 times that of the US, I would find you guilty as charged, on the basis of not considering the possibility :)
- Armisael16 5y ago
  I think it is surprising. The US has a larger nominal GDP (which is what matter for this calculation), and USD is also rather unique as the global reserve currency. 60% of USD are held outside the US. These stats would seem to indicate that either CNY moves much more slowly than USD (which would also surprise me) or that there are also colossal reserves of CNY outside of China (which I believe the Chinese government is actively working to prevent with capital controls?). Population isn’t that big a factor. India has 36x as many people as Canada, but INR and CAD have about the same total cap.
  - z2trillion 5y ago
    I think the site is reporting M2 for each of the currencies, which includes much more than just the bills + coins. E.g. the value of all USD coins + bills is "only" $2.1 trillion [1] vs. an M2 that's 10x larger. The 60% of all USD are held overseas statistic only applies to coins + bills and not M2 [2]. An explanation could be that people in Chinese save more and keep more of their savings in banks, compared to Americans? [1] "Currency in circulation" in https://www.federalreserve.gov/releases/h41/20210506/ https://www.federalreserve.gov/releases/h41/20210506/ [2] https://www.bullionstar.com/blogs/jp-koning/how-much-u-s-currency-is-held-overseas/ https://www.bullionstar.com/blogs/jp-koning/how-much-u-s-cur...
garyclarke27 5y ago
Yes these stats don't make sense, I don't believe them. US Nominal GDP is way higher than China plus USD is still the world's reserve currency ie has massive usage outside the US.
- bordercases 5y ago
  From what I understand it isn't dollars that dominate global exchange but dollar denominated assets and instruments.
- mrslave 5y ago
  IMF recently reported that China's economy has already surpassed USA by annual GDP when measured in purchasing power parity (PPP) - as opposed to market exchange rates (MER). [0] I don't pretend to understand this much further so I welcome comments from anyone who does. [0] https://nationalinterest.org/feature/china-now-world%E2%80%99s-largest-economy-we-shouldn%E2%80%99t-be-shocked-170719 https://nationalinterest.org/feature/china-now-world%E2%80%9...
  - Armisael16 5y ago
    PPP is totally irrelevant for this discussion.
- dtwest 5y ago
  According to the Federal Reserve, China's money supply is larger than the US. GDP levels don't directly map into money supply. https://fred.stlouisfed.org/series/WM2NS https://fred.stlouisfed.org/series/WM2NS https://fred.stlouisfed.org/series/MYAGM2CNM189N https://fred.stlouisfed.org/series/MYAGM2CNM189N The more interesting theoretical question here is whether BTC should be compared to M1 or M2 (or another metric entirely).
- delaaxe 5y ago
  China's monetary expansion policy has been way more aggressive than the US's.
_marlowe_ 5y ago
It would be more interesting to see this indexed against each country's respective population

jeppebemad 5y ago

With China’s population being more than 4 times that of the US, I would find you guilty as charged, on the basis of not considering the possibility :)

Armisael16 5y ago
I think it is surprising. The US has a larger nominal GDP (which is what matter for this calculation), and USD is also rather unique as the global reserve currency. 60% of USD are held outside the US. These stats would seem to indicate that either CNY moves much more slowly than USD (which would also surprise me) or that there are also colossal reserves of CNY outside of China (which I believe the Chinese government is actively working to prevent with capital controls?). Population isn’t that big a factor. India has 36x as many people as Canada, but INR and CAD have about the same total cap.
- z2trillion 5y ago
  I think the site is reporting M2 for each of the currencies, which includes much more than just the bills + coins. E.g. the value of all USD coins + bills is "only" $2.1 trillion [1] vs. an M2 that's 10x larger. The 60% of all USD are held overseas statistic only applies to coins + bills and not M2 [2]. An explanation could be that people in Chinese save more and keep more of their savings in banks, compared to Americans? [1] "Currency in circulation" in https://www.federalreserve.gov/releases/h41/20210506/ https://www.federalreserve.gov/releases/h41/20210506/ [2] https://www.bullionstar.com/blogs/jp-koning/how-much-u-s-currency-is-held-overseas/ https://www.bullionstar.com/blogs/jp-koning/how-much-u-s-cur...

garyclarke27 5y ago

Yes these stats don't make sense, I don't believe them. US Nominal GDP is way higher than China plus USD is still the world's reserve currency ie has massive usage outside the US.

bordercases 5y ago
From what I understand it isn't dollars that dominate global exchange but dollar denominated assets and instruments.
mrslave 5y ago
IMF recently reported that China's economy has already surpassed USA by annual GDP when measured in purchasing power parity (PPP) - as opposed to market exchange rates (MER). [0] I don't pretend to understand this much further so I welcome comments from anyone who does. [0] https://nationalinterest.org/feature/china-now-world%E2%80%99s-largest-economy-we-shouldn%E2%80%99t-be-shocked-170719 https://nationalinterest.org/feature/china-now-world%E2%80%9...
- Armisael16 5y ago
  PPP is totally irrelevant for this discussion.
dtwest 5y ago
According to the Federal Reserve, China's money supply is larger than the US. GDP levels don't directly map into money supply. https://fred.stlouisfed.org/series/WM2NS https://fred.stlouisfed.org/series/WM2NS https://fred.stlouisfed.org/series/MYAGM2CNM189N https://fred.stlouisfed.org/series/MYAGM2CNM189N The more interesting theoretical question here is whether BTC should be compared to M1 or M2 (or another metric entirely).
delaaxe 5y ago
China's monetary expansion policy has been way more aggressive than the US's.

_marlowe_ 5y ago

It would be more interesting to see this indexed against each country's respective population