The global economy wobbles as trade tensions escalate. U.S. President Donald Trump’s proposed tariffs on $2.4 trillion of imports and retaliatory threats from China and others have markets bracing for chaos.
Yet amid the turmoil, experts argue blockchain technology, the backbone of Web3, could emerge as an unlikely solution. From verifying product origins to sidestepping sanctions, decentralised systems may soon become governments secret weapon in navigating trade wars.
Trustless Verification
Trade wars hinge on tariffs, but enforcing them fairly remains a headache. Blockchain’s immutable ledgers could solve this. Imagine a company assembling goods in a low-tariff country to dodge higher U.S. fees. “Blockchain proves where products actually originated,” says Federico Kattan, CTO of blockchain firm Truebit. By recording every supply chain step publicly, fraud becomes nearly impossible. With $2.4 trillion of imports at stake, such transparency isn’t just useful; it’s critical.
Truebit, already advising U.S. software vendors and EU projects, sees governments leaning on Web3 to verify compliance. “It’s about trustless accountability,” Kattan adds.
Bypassing Sanctions Through DecentraliSed Networks
When traditional financial systems like SWIFT become political tools, countries turn elsewhere. Web3’s peer-to-peer networks let nations trade directly, avoiding sanctioned banks. Cryptocurrencies and smart contracts enable cross-border deals without intermediaries. For instance, Iran and Russia have explored crypto to bypass U.S. sanctions. “Decentralised systems offer an escape hatch,” notes a blockchain analyst.
This shift isn’t just theoretical. Concrete & Glow Finance CEO Nicholas Roberts-Huntley warns tariffs could disrupt blockchain infrastructure. Still, the lure of sanction-proof trade grows stronger.
Reclaiming Control with Digital Currencies
Trade wars expose fiat currencies vulnerabilities. As the U.S. dollar’s dominance wavers, governments eye central bank digital currencies (CBDCs) built on blockchain. These systems let nations control monetary policy tightly and reduce foreign currency reliance. China’s digital yuan trials, for example, aim to insulate its economy from dollar-driven shocks.
“CBDCs on blockchain blend sovereignty with innovation,” says Jason Teutsch, Truebit’s CEO. While not yet mainstream, over 130 countries are exploring CBDCs, a sign of Web3’s geopolitical appeal.
Fortifying Supply Chains with Transparency
Global supply chains, rattled by trade disputes, need resilience. Blockchain’s tamper-proof tracking helps governments secure critical goods. Truebit’s EU-funded project, for instance, tests Web3’s role in tracing materials from source to market. If a country bans imports, blockchain verifies substitutes authenticity swiftly.
Furthermore, companies like Walmart use blockchain to track produce in seconds, not days. For governments, such speed could prevent shortages during trade spats.
Democratising Finance Amid Exclusion
Trade wars often lock nations out of markets. Web3’s decentralised finance (DeFi) platforms offer a lifeline. By accessing DeFi, countries bypass traditional gatekeepers to secure loans or investments. Venezuela, excluded from global markets, has turned to crypto for oil deals. “DeFi rewrites the rules of financial access,” says a DeFi advocate.
Still, risks linger. Volatility and hacking plague crypto markets. Yet for governments with few options, DeFi’s risks may pale next to its rewards.
Innovation vs. Challenges: Web3’s Tightrope Walk
Adopting Web3 isn’t simple. Regulatory clashes, scalability limits, and cyberthreats loom large. “Node operators could face new barriers if trade policies fragment,” warns Roberts-Huntley. Moreover, illicit transactions on decentralised networks worry regulators.
Yet necessity drives innovation. As trade wars intensify, Web3’s promise of autonomy and efficiency grows harder to ignore. Truebit’s talks with governments signal shifting tides. “We’re building bridges between Web3 and policymakers,” Teutsch says.
The Path Ahead
Trade wars force hard choices. While Web3 offers solutions, its success hinges on balancing innovation with oversight. For governments, the question isn’t whether to embrace decentralisation but how fast they can adapt. As tariffs reshape global trade, blockchain’s role in securing fairness and sovereignty may prove indispensable. The race to Web3 is on.
