The most powerful weapon the United States possesses is not a carrier group or a stealth bomber. It is the ability to disconnect a country from the dollar. For eighty years the dollar has been the world’s reserve currency, and the rails it runs on — principally the SWIFT messaging network — have been the plumbing of global trade. To be cut off from SWIFT is to be cut off from the modern economy: unable to pay for imports, sell exports, or move money across borders through normal channels. It is a weapon of extraordinary force, deployable without firing a shot. And like every powerful weapon, every use of it teaches the people on the receiving end exactly why they need a way to make it useless.
That lesson is now being learned at scale. Three crises in two years — the Iranian oil war, the Russian sanctions regime, and the Ukrainian defence — have revealed, from three completely different political positions, the same structural demand: for a neutral, global, instantly available settlement layer that no single government can switch off. This is the companion to Part 1: where that piece covered crypto as infrastructure for machines, this one covers crypto as infrastructure for states — the geopolitical face of the same shift.
Iran: A Dollar a Barrel, Paid in Bitcoin
Begin with the most striking case. Following the strikes of February 2026 and the closure of the Strait of Hormuz — through which roughly a fifth of the world’s oil passes — a fragile ceasefire reportedly allowed westbound tankers to transit again, for a fee. The fee was one dollar per barrel. The currency of payment was Bitcoin.
Transit tolls are nothing new — the Ottoman straits, the Danish Sound Dues, the Suez Canal all charged for passage. What is new is the settlement currency, and the reason is the heart of the story. Iran has been excluded from SWIFT since 2012 and is effectively shut out of the dollar system. For years it routed around this using the dollar stablecoin USDT, prized for its dollar denomination and deep liquidity. So why the shift to Bitcoin?
Tether and Circle freeze sanctioned addresses to stay compliant. Bitcoin, as a bearer asset with no central issuer, has no one who can freeze it. That difference is the entire point.
To comply with US sanctions, the stablecoin issuers increasingly freeze the addresses of sanctioned actors — which makes a dollar stablecoin a treacherous tool for a state under sanctions. Bitcoin has no such vulnerability: no central issuer, no compliance department, no one who can press a button and immobilise it. The very property maximalists describe in philosophical terms — censorship resistance — turns out to have a brutally practical geopolitical application. And there is a second half that resists a simple villain narrative: of the crypto revenue flowing through Iranian addresses, roughly half is the Revolutionary Guard, and the other half is ordinary Iranians preserving their savings against a collapsing currency. The same tool serves the regime and the people fleeing the regime’s monetary destruction.
Russia: Building a Shadow Dollar
Russia’s case shows the same demand through more elaborate financial engineering. Cut off from SWIFT after the 2022 invasion, with Visa and Mastercard suspended, its ecosystem produced A7A5 — a ruble-backed stablecoin, issued through a Kyrgyz entity, running on Tron and Ethereum, reserved in rubles at a sanctioned Russian state bank.
The mechanism is elegant in a way that should worry anyone who believes sanctions are airtight. A Russian company converts rubles into A7A5 through a Kyrgyz exchange, swaps the A7A5 for USDT or Bitcoin on a decentralised exchange that no government operates, and emerges holding dollar-equivalent liquidity — having never once touched the dollar banking system that is supposed to be closed to it. At its peak the system was reportedly clearing a billion dollars a day. When the US sanctioned the linked exchange in August 2025, the administrators destroyed and re-minted the bulk of the circulating tokens, severing the links to sanctioned wallets, and simply continued.
Ukraine: The Same Tool, the Other Side
If Iran and Russia were the only cases, you could file crypto-as-settlement-layer under “tool of rogue states.” Ukraine makes that impossible. Attacked rather than sanctioning, defending rather than evading, Ukraine reached for exactly the same technology — and that symmetry is the most important fact in this issue. When the invasion began, the central bank imposed strict capital controls, and citizens fled into digital assets to protect their savings — the same capital-preservation move Iranian citizens were making, for the same reason. The government received tens of millions of dollars in crypto donations within the first weeks of the war, fast and borderless in a way the banking system could not match in a crisis. By 2026, Ukraine is estimated to hold billions of dollars in Bitcoin, placing it among the largest sovereign holders on Earth.
The lesson is not that crypto is good or bad. It is that crypto is neutral, and that neutrality is precisely what makes it valuable as a settlement layer. The same property — that no state controls it — serves the aggressor evading sanctions and the defender resisting invasion, the authoritarian regime and the citizen fleeing it. A settlement layer that picked sides would be useless as a settlement layer. The whole point is that it does not.
The Dollar’s Self-Inflicted Wound
Step back, and the structural picture is unmistakable. The dollar’s share of global foreign-exchange reserves has fallen from over 70% at the turn of the millennium to under 58% — the lowest in decades. There are many causes, but one is self-inflicted: every time SWIFT is used as a weapon, it creates an incentive for every country that might one day be a target to build an exit before they need it. China watched what happened to Russia. Every non-aligned state watched what happened to Iran. The weapon is teaching the world to disarm it.
Here is the strategic irony at the centre of it all. The alternative settlement layer is, overwhelmingly, still dollar-denominated — more than 99% of the stablecoin market is priced in dollars. So the move away from the dollar banking system paradoxically reinforces the dollar as the world’s unit of account. America is simultaneously losing and winning: losing transaction control, as value increasingly moves on rails it cannot police, while extending the dollar’s role as the thing everyone prices in. The dollar is becoming less of a system you must use and more of a standard you happen to choose — and Bitcoin sits underneath even that, as the one settlement asset denominated in nothing but itself.
What It Means
The architecture of payment is the architecture of power. This is one of the deepest theses running through The New Architecture: structures determine outcomes. SWIFT was built as plumbing and became a weapon, and that transformation determined the political dependencies of every nation that relies on it. Whoever controls the settlement layer of the world economy holds leverage that rivals any military — and the contest over who controls the next one (states via CBDCs, private issuers via stablecoins, or no one via Bitcoin) is one of the defining power struggles of the century.
Neutrality is the product, not a flaw to be fixed. The instinct of every regulator is to see crypto’s ungovernability as a problem to be solved. But the three cases show that neutrality is exactly what gives a settlement layer its value: a rail that served only the approved actors would be just another arm of the state that approved them. You cannot have the neutrality without the ungovernability — they are the same property seen from two sides. And beneath it all, the distinction that closed Part 1 holds here too: stablecoins are still someone’s liability, denominated in someone’s currency, freezable by someone. Bitcoin is no one’s liability, denominated in nothing but itself, freezable by no one. In a world where the reserve currency can be turned into a weapon, the asset that cannot be weaponised by anyone — because no one controls it — occupies a position that has never existed before.
Flight Log — Dispatch from Altitude
Aviation runs on a neutral settlement layer, and most people never notice it. When I fly across borders, I cross through the airspace of nations that may be hostile to one another, that may sanction one another, that may be at the edge of war — and yet the system that lets me pass operates above all of it. A flight plan filed in one country is honoured in the next. A controller in one nation hands me to a controller in another without regard to the politics between their governments. The standards are neutral by design, and that neutrality is exactly what makes the global system function. The moment air traffic control picked sides, the sky would close.
I have flown routes that thread between countries in open conflict, where the airspace itself is a negotiated, contested thing. And what strikes me, every time, is that the technical layer holds even when the political layer is in flames. The transponder codes, the separation standards, the emergency frequencies — these are honoured by pilots and controllers who would not, on the ground, agree on anything. The neutrality of the system is not a nice ideal. It is load-bearing infrastructure that keeps aircraft from falling out of a politically fractured sky.
This is what the world is now reaching for in money. A settlement layer that holds even when the political layer is at war — that lets value cross a hostile border the way my aircraft crosses a hostile frontier, on neutral standards no single government can revoke. When Iran is paid in Bitcoin and Ukraine holds Bitcoin and a Russian stablecoin clears a billion dollars a day, what they are all reaching for is the monetary equivalent of the airspace I fly through: a neutral medium that functions precisely because no one nation owns it.
The dollar was supposed to be that medium, and for eighty years it was. But the dollar has an owner, and an owner can weaponise. The moment the United States showed it would close the financial airspace to those it opposed, it taught the rest of the world to build a sky that cannot be closed. Bitcoin is the first settlement layer with no control tower — no one who can deny you passage, because there is no one in command at all. I trust the neutral standards of the sky because they are honoured regardless of who is flying. The world is learning to want money that works the same way: honoured regardless of who is holding it, open to everyone, owned by no one, and impossible to switch off.