WASHINGTON, D.C. — A leading digital asset policy expert argues that Bitcoin and the U.S. dollar are not rivals but partners in a mutually reinforcing financial system. According to Sam Lyman, head of research at the Bitcoin Policy Institute (BPI), the dominant use of dollar-based trading pairs creates a “symbiotic” link that benefits both currencies. This perspective challenges a common narrative in crypto circles.
The Symbiotic Relationship Between Bitcoin and the Dollar
Sam Lyman told Cointelegraph that the connection is straightforward. “Bitcoin is beneficial to the U.S. system because the largest Bitcoin trading pair is BTC/USD,” he said. This includes trades involving Tether’s USDt (USDT) stablecoin, which is backed by cash and short-term U.S. government debt. Lyman’s analysis suggests that demand for Bitcoin, when paired with the dollar, inherently boosts demand for the dollar itself. “I do see those things as being mutually reinforcing,” Lyman stated. “This runs contrary to the narrative around BTC that it would actually undermine the dollar.”
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Data supports this view. In 2024, dollar-based trading pairs, including those with major stablecoins, dominated Bitcoin markets. According to market analytics firm Kaiko, a significant majority of global Bitcoin volume was against the dollar or dollar-pegged assets. This creates a feedback loop. More Bitcoin adoption means more transactions needing dollars for settlement.
Stablecoins: The Modern Petrodollar?
Lyman draws a direct parallel to a longstanding pillar of U.S. economic power. He said Bitcoin and dollar-pegged stablecoins share a relationship similar to the dollar and oil. The petrodollar system, established in the 1970s, mandates that international oil sales are priced in U.S. dollars. This creates constant global demand for the currency to help energy trade.
Stablecoins now perform a similar function in digital asset markets. They act as the primary on-ramp, off-ramp, and trading pair for cryptocurrencies. “There is a symbiotic relationship between BTC and the dollar system because BTC is most frequently traded in dollars,” Lyman explained. Industry watchers note that this dynamic could cement the dollar’s role in the next generation of finance. What this means for investors is a potential alignment between crypto growth and traditional dollar strength.
The Regulatory Imperative for the US
This relationship informs Lyman’s policy advice. He urged U.S. lawmakers to advance stablecoin regulations, like those outlined in the proposed GENIUS Act framework, without compromising core principles. The goal, he argues, is to protect and extend U.S. dollar hegemony. “To strengthen and protect U.S. dollar hegemony and remain competitive in geopolitics,” Lyman said, clear rules for dollar-backed digital assets are essential.
Analysts suggest that without a coherent U.S. regulatory framework, other currencies could capture this critical role. The implication is that regulatory clarity isn’t just about consumer protection—it’s a matter of economic and strategic national interest. This could signal a shift in how policymakers view cryptocurrencies, from a threat to a potential tool for maintaining financial influence.
China’s Contrasting Approach: Ban and Control
The U.S. approach stands in stark contrast to China’s. Lyman told Cointelegraph that China has repeatedly banned Bitcoin and stablecoins because they pose a “tremendous threat” to government capital controls. “The entire Chinese economy depends on capital controls,” Lyman said. “China is able to keep money within the country by preventing its elite from moving money out.”
This is why China reaffirmed its stablecoin ban in 2025. Instead, the country is pushing its digital yuan, a central bank digital currency (CBDC). Unlike permissionless cryptocurrencies, the digital yuan is fully programmable and controlled by the People’s Bank of China. It is designed to control capital flows and capture a larger share of the foreign exchange market. However, Lyman notes these bans have failed to stop crypto activity. Data from Hashrate Index shows that despite a mining ban, Chinese mining pools still control over 36% of the global Bitcoin hashrate. Stablecoin flows to and from China also persist.
What the Data Shows About Market Dominance
The numbers tell a clear story of dollar dominance in crypto. A snapshot of the Bitcoin market in early 2026 shows the overwhelming prevalence of USD pairs.
Key Trading Pairs for Bitcoin (Representative Data):
- BTC/USDT: ~70-75% of global spot volume
- BTC/USD (Direct): ~10-15% of volume
- BTC/EUR, BTC/GBP, BTC/JPY: Combined share typically under 15%
This concentration means the health of the dollar directly impacts Bitcoin liquidity and accessibility. A weaker dollar could make Bitcoin more expensive for international buyers, but it could also increase its appeal as an alternative. Conversely, a strong dollar might boost Bitcoin’s purchasing power for those holding it. The relationship is complex but undeniably linked.
The Future of Digital Currency Competition
The battle for supremacy in digital currency is intensifying. On one side are permissionless, decentralized assets like Bitcoin. On the other are government-controlled digital currencies like China’s digital yuan. In the middle are dollar-pegged stablecoins, which have become the de facto bridge between the two worlds.
Lyman’s argument centers on opportunity. The U.S. can employ the organic adoption of its currency in crypto to maintain global financial leadership. But this requires action. Stablecoin regulation has been debated in Congress for years without comprehensive legislation passing. The delay, some experts warn, creates a vacuum. Other jurisdictions, including the European Union with its MiCA framework, are moving faster to set rules.
This suggests the window for the U.S. to formalize its advantage may not be open forever. The policy decisions made in Washington over the next year could determine whether the symbiotic relationship between Bitcoin and the dollar becomes a permanent feature of finance or a missed opportunity.
Conclusion
The relationship between Bitcoin and the U.S. dollar is more collaborative than confrontational. The data shows the dollar’s entrenched role as the primary trading pair for Bitcoin. Dollar-pegged stablecoins have further cemented this link, creating a modern analog to the petrodollar system. For U.S. policymakers, this presents a strategic chance to bolster the dollar’s global standing through thoughtful regulation. Meanwhile, China’s restrictive approach highlights the perceived threat these technologies pose to controlled economies. The evolving Bitcoin US dollar relationship will be a key factor shaping the next decade of global finance.
FAQs
Q1: What does a “symbiotic relationship” between Bitcoin and the dollar mean?
It means they benefit each other. Bitcoin’s primary trading pairs are against the U.S. dollar or dollar-backed stablecoins. Therefore, increased Bitcoin trading volume drives more demand for dollars to allow those trades, reinforcing the dollar’s use.
Q2: How are stablecoins related to the petrodollar system?
Stablecoins create a similar dynamic. Just as the petrodollar system requires countries to hold dollars to buy oil, traders and exchanges must hold dollars or dollar-backed assets to trade Bitcoin and other cryptocurrencies. This creates constant, structural demand for the U.S. currency.
Q3: Why does China ban Bitcoin and stablecoins?
According to Sam Lyman of the Bitcoin Policy Institute, they threaten China’s strict capital controls. The Chinese government seeks to prevent capital flight and maintain control over its financial system. Permissionless cryptocurrencies allow users to move value outside of state-controlled channels.
Q4: Has China’s ban on Bitcoin mining been successful?
Not entirely. Data from Hashrate Index indicates that as of early 2026, Chinese mining pools still control more than 36% of the global Bitcoin network’s hashrate. This suggests mining activity has persisted despite official prohibitions, often through covert operations or relocation to neighboring countries.
Q5: What is the GENIUS Act and why is it important?
The GENIUS Act is proposed U.S. legislation aimed at creating a regulatory framework for payment stablecoins. Experts like Lyman argue that passing such a law is vital to provide clarity, protect consumers, and formally harness the dollar’s dominance in crypto to support U.S. economic interests.
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