Economy

From its $126,000 all-time high to yesterday’s close near $69,000, Bitcoin—the poster child of cryptocurrencies—has lost approximately 45% of its value, wiping out an estimated $1.1 trillion in nominal investor wealth. Bitcoin’s latest crash is not just another bout of volatility. It is a stress test of the entire crypto architecture: the belief that ETFs created a permanent institutional bid, the assumption that stablecoins are “cash equivalents,” the rise of corporate leverage masquerading as long-term conviction, and the accelerating reality that states—China first, others inevitably following—intend to dominate the future of digital money.

With the Allied victory in World War II, the United States of America emerged as a superpower presiding over the destiny of the Western world. The enormous US industrial machine contributed significantly to the military victory over fascism. In the first part, we saw how the US imposed its model, not only through its military power, but also through a new global economic, financial, and institutional order. In this second part, we will detail the risks currently facing America. The "Make America Great Again" doctrine marks a break in contemporary geopolitics. The greatest casualty of this rupture may be the United States itself, not because it lacks power, but because it has become structurally fragile.

For more than seven decades, the US Federal Reserve stood as a fortress at the core of America’s economic success: the steward of the world’s reserve currency and the institution markets trusted to anchor financial stability. It acted as lender of last resort with a dual mandate – controlling inflation on the one hand, supporting economic growth on the other. For most of this period, monetary policy was entrusted to independent professionals, formally insulated from both the executive and legislative branches of government. That independence, however, was never a constitutional given. It was a carefully constructed institutional equilibrium – one that markets gradually came to treat as permanent.

The Exclusive Economic Zone (EEZ) delimitation agreement between Lebanon and Cyprus, signed on November 26, 2025, and endorsed by Decree No. 2108 of December 16, 2025, marks a major step in Lebanese maritime policy. Officially presented as a means to guarantee the exploitation of maritime resources, this agreement nevertheless raises deep concerns from legal and strategic perspectives. General Khalil Gemayel, an expert in maritime border delimitation, believes that this agreement, despite some advantages, remains largely unfavorable to Lebanon. It certainly puts an end to a long-standing dispute, but at what cost?

For much of the past four years, global energy markets have appeared deceptively calm. Oil prices have fallen by more than half since their US$ 130 peak in 2022. Natural gas prices have normalized after the shock of the war in Ukraine. Renewable energy headlines dominate the narrative, reinforcing the idea that fossil fuels are gradually being relegated to history. At first glance, the world seems well supplied. Yet beneath this surface calm lies a far more unstable reality — one shaped by chronic underinvestment, physical depletion, geopolitical concentration, and rising structural demand. The global energy system today is not resilient. It is balanced on a knife edge.

On December 26, 2025, the Council of Ministers adopted the so-called “Gap Law,” a text intended to provide a legal framework for the allocation of the country’s financial losses, estimated at around USD 70 billion, ahead of its forthcoming review by Parliament. The draft law was approved by 13 votes to 9. The law introduces a classification of depositors based on the volume of their assets and provides for a guarantee mechanism for deposits of up to USD 100,000, in the form of staggered repayments over a four-year period. For amounts exceeding this cap, the legislative framework provides for the conversion of deposits into long-term financial instruments issued by the Banque du Liban, structured as asset-backed securities.

The proposal to create an economic zone in South Lebanon, mentioned in August 2025 by US envoy Tom Barrack, created a shockwave. The theory behind the project of a “Trump Economic Zone” assumes that such a zone would attract foreign investment, finance reconstruction, thus guaranteeing lasting security. However, several voices have been raised to warn against the danger of undermining the sovereignty of the Lebanese state through the creation of an Israeli-American “protectorate” in the border area. The project of a “Trump Economic Zone” is part of an approach adopted by the current US president to resolve conflicts through economic development and trade.

Al-Qard Al-Hassan, formally registered as a charitable association, has increasingly assumed the role of a parallel financial institution in Lebanon since the country’s economic collapse began in late 2019. As the banking sector imploded and depositors lost access to their savings, the organisation stepped into an institutional vacuum. While its services address real needs in a context of state and financial failure, its growing footprint raises serious legal and systemic concerns. Founded during Israel’s 1982 invasion of Lebanon, Al-Qard Al-Hassan was registered in 1987 with the Ministry of Interior as a non-profit association. It remains legally governed by the 1909 Ottoman Law on Associations, which restricts activities to non-commercial, non-profit purposes. Yet in practice, the organisation regularly grants loans and manages gold-backed guarantees—activities that go well beyond its declared legal mandate.

If artificial intelligence supplied the narrative fuel for the extraordinary market performance of 2025, liquidity supplied the oxygen. And while much attention focused on the policies of Western central banks, the most persistent — and ultimately destabilising — source of global liquidity came from elsewhere: Japan. For decades, Japan was treated as an anomaly — an economy trapped in deflation, operating under its own monetary logic and largely disconnected from global cycles. In 2025, that perception proved dangerously outdated. Japan did not merely remain accommodative; it became one of the principal enablers of global risk-taking. For years, the Bank of Japan accumulated trillions of dollars’ worth of bonds and equities on its balance sheet while holding interest rates near zero.

No single force shaped the trajectory of financial markets in 2025 more decisively than artificial intelligence. AI became the dominant narrative through which investors justified elevated valuations, extreme concentration, and rising risk-taking. It offered a forward-looking story powerful enough to neutralise concerns about slowing growth, mounting debt, and geopolitical fragmentation. At its core, AI is a genuine technological revolution — a productivity leap comparable to electrification or the internet — and it is already reshaping entire industries. But financial markets do not price long-term societal benefits; they price microeconomic realities: corporate cash flows, capital intensity, and sustainability. It is at this level that a growing disconnect emerged.