Why Hormuz helps us understand that currency is our identity
In his book Identity, Milan Kundera delves into the souls of two characters who, without realizing it, find themselves suddenly defending the most taken-for-granted thing there is: their own identity, shaped by age, habit, and even boredom.
There is one detail in recent news that risks being dismissed as an exotic curiosity, but it deserves close attention: the fact that Iran is asking for payment for transit through the Strait of Hormuz only in yuan or cryptocurrencies. This is not just a political provocation. It is a signal, perhaps still embryonic but already very concrete, of a deeper transformation: currency is returning to the center of sovereignty. And it represents identity. To impose new rules, to assert one’s strength, or to defend one’s values.
For decades, we have lived within an apparently natural balance: the dollar as the invisible infrastructure of global trade. Not just a medium of exchange, but a unit of account, a store of value, and a tool for financial regulation. In other words, an essential part of the international order. That system was not neutral, but it worked because everyone—friends and adversaries alike—considered it convenient.
Today, that consensus is starting to crack. Financial sanctions, the growing use of payment systems as a geopolitical lever, and the fragmentation of value chains are pushing some countries to look for alternatives. This is not yet a full-fledged “de-dollarization”—the dollar remains dominant—but it is a clear trend: the desire to reduce dependence on a currency perceived as an instrument of someone else’s power. Not by chance, the United States is responding to all this through the “Genius Act,” a sophisticated operation that makes it possible to issue stablecoins backed by U.S. government securities. On the one hand, an unprecedented securitization mechanism to keep issuing debt. On the other, a new way of asserting American currency and identity under different guises.
Iran’s demand for payments in yuan or crypto should be read in this light. The yuan is the expression of a power that aims to build its own monetary sphere. Cryptocurrencies, despite their volatility, represent a very strong attempt to break out of traditional circuits by circumventing controls and sanctions. They are two different paths, but they converge on one point: escaping the hegemony of the dollar.
For Europe, this scenario is not neutral. On the contrary, it is a direct call to action. For too long, we have regarded the euro primarily as an internal project: price stability, fiscal discipline, market integration. All fundamental elements, but insufficient if not accompanied by an external dimension. A currency is sovereign not only because it guarantees domestic stability, but because it makes it possible to act in the world.
If international trade fragments into currency areas, if payments become instruments of geopolitical pressure, then having a strong and autonomous currency becomes a condition of economic security. It is not enough to take part in the system: one must be able to choose. Just think for a moment about what happened during this year’s Winter Olympics: at some stands, food and drinks could be purchased only with one type of credit card, owned by an American company, with no possibility of using cash. A small example, an experiment that represents in miniature what the power of currency really means. Anyone who did not have it could do nothing.
In this context, the debate over the digital euro takes on a meaning that goes beyond technology. It is not merely an innovation in payment systems. It is a building block of European sovereignty. It means creating our own infrastructure, reducing dependence on non-European networks, and ensuring that payments—even those of the future—remain within a framework of control consistent with our values and interests.
Naturally, the path is complex. The risk is twofold: on the one hand, underestimating the scale of the change and falling behind; on the other, chasing rushed solutions without a strategic vision. Europe must avoid both mistakes. What is needed is a pragmatic yet ambitious approach: strengthening the international role of the euro, rapidly developing the digital euro with careful attention to security and privacy, and building alliances that encourage its adoption beyond Europe as well.
Ultimately, the lesson is simple and ancient: currency is never just economics. It is power, trust, and the ability to project influence. When a country or a monetary area loses control of its own currency, it also loses part of its sovereignty. When, instead, it strengthens that currency, it expands its own space of freedom.
The Strait of Hormuz is now a geopolitical laboratory. Not only because of military tensions, but because of what is happening in the invisible flows of payments. Ignoring it would be a mistake. Reading it clearly may help us understand that the contest over currency—and therefore sovereignty—has already begun. And that Europe cannot afford to remain a spectator. The question for all of us, then, is whether we want to defend our identity, which, as told in Kundera’s book, is suddenly being called into question. Currency, our euro in its traditional form and, as soon as possible, in digital form, has suddenly become the instrument for doing so. If narrow calculations, local interests, and short-term considerations prevail, our identity will be shaped—and then managed—by others.
