The 1970s produced floating exchange rates, the junk bond market, the leveraged buyout, KKR, the Bloomberg terminal, index funds and the end of fixed brokerage commissions, most of it inside about fifteen years.
Most readings treat that as a run of unrelated events. Nicolas Colin reads it as what happens when a technological revolution stops producing growth and the only lever left is finance — and he says the same phase has now arrived for semiconductors, computing and networks.
"And so that's why every regime that relied on some hard asset, whether the gold standard or the Bretton Woods regime, which was a gold standard by proxy of the dollar, was ultimately brought to an end, not because it didn't work, but because the economy grew so much thanks to technology mostly that we had to let go of the hard asset and find something else to encode the economy."
Marieke Flament was an early Circle executive through the launch of USDC, later ran NatWest's small-business bank Mettle and the NEAR Foundation, and sits on the boards of IG Group, N26 and Qivalis; Colin was a senior civil servant in the French finance ministry and is head of research at the Munich deep-tech fund Vsquared Ventures. They write the Currency of Power newsletter together.
The full episode is covered here so you can skip it. 54 minutes of audio, 23 minutes of reading.
Here are the 8 arguments that matter.
👤 Guests: Marieke Flament, co-author of the Currency of Power newsletter, an early executive at Circle through the launch of USDC and later CEO of NatWest's small-business bank Mettle and of the NEAR Foundation; Nicolas Colin, co-author of Currency of Power, Head of Research at Vsquared Ventures and a former senior civil servant in the French finance ministry
🎙️ Host: Demetri Kofinas, who created and hosts Hidden Forces
📰 Published: 14 September 2026 on YouTube (Hidden Forces) · recorded 9 September 2026
🔴 YouTube | 🔗 Episode page | ⏱️ 54 min | ✅ Time saved: 31 min
Key Takeaways
The 1970s were not a run of bad luck, they were what a technology cycle does when it runs out of growth
Nixon shock, junk bonds, leveraged buyouts, KKR, the Bloomberg terminal, Vanguard, May Day and the London Big Bang inside about fifteen years
Every hard-money regime has been ended by growth, not by failure
A fixed stock of gold cannot encode an economy that productivity keeps enlarging
What blockchains add is that the contract and the money stop being separate systems
Colin's example is a fund vehicle where a human reads the agreement and then instructs the bank by hand
De-dollarization is a decades-long process being reported as a weekly one
Hong Kong, the supposed door out of the dollar, runs a currency pegged to it
Being the reserve currency and being the currency of trade are two different jobs
A country can lose one while keeping the other, which is what Flament thinks China is testing
Sterling outlasted the British economy that produced it by about fifty years
It took two world wars, the 1931 devaluation and a bombed-out Britain to unseat it
The dollar's stickiness is infrastructure, not sentiment
Rails that already exist everywhere, and liquidity deep enough that a counterparty is always there
1. How The Newsletter Began
Kofinas opened with the two backgrounds, because only Colin had been on the show before. "By background, I'm a computer engineer," Flament said. Her first job in financial technology was at Circle, the company behind the USDC stablecoin; she went on to run a UK digital neobank owned by a larger bank, and then a layer-one blockchain protocol. She now advises a European stablecoin consortium and sits on boards including the German neobank N26 and IG Group.
Colin's route was the reverse. "I've been working in tech for about 15 years across Europe between Paris, London and Munich," he said, and before that: "Before that, I was a senior civil servant in the French Ministry of Finance where I dealt with mostly public administration, macro stuff." He is now head of research for a Munich deep-tech fund and writes two newsletters
Kofinas' own observation was about how careers have changed. He said it was funny listening to both bios and reflecting on how much more entrepreneurial and multi-faceted work has become — a little of this, a little of that — and then named the reason: "You need to have a public facing component. You need to be out there and that's essentially your source of power in the marketplace."
The two met in 2018, when Flament was at Circle and Colin was writing about Bitcoin for his newsletter Drift Signal. They were at the same event, got talking, found they had studied the same subjects, and started arguing about what Bitcoin actually was
That argument ran for years. Colin said he was not involved in crypto but needed a way back in: "But I kind of needed to once a year find someone to talk to, to update my view of the space."
The newsletter came out of an interview that was not going well. Colin approached Flament early in 2025 for a long interview covering everything from FTX to Trump
"I thought he was a really tough interviewer," Flament said. "He's just so not seeing what I'm seeing until I spoke about stablecoin." That was the point at which, on her account, something clicked
Colin's conversion was to stablecoins as the first convincing large-scale use case for crypto, and his immediate objection was that they are all dollars. "And in particular, the euro is nowhere to be found in the stablecoins space, which at some point will become a problem for Europe from a sovereignty perspective, from a strategic power perspective, from a financial perspective," he said
The gap in the coverage was what decided it: "It was very difficult to find anything written about euro stablecoins and why they didn't really exist at the time and why they were still important."
"And so I said, just with my sense of what works in the public space, if it's so niche, but so important, there's room for launching a newsletter." The first version was called Euro Stable Watch
They ran out of euro-stablecoin news within a few months, which is what widened the brief. "We need to cover dollars. We need to cover what's happening in China," Colin said, and the newsletter was rebranded Currency of Power around the larger subject of reinventing money
2. What Crypto Actually Adds
Kofinas pushed on the vocabulary before the substance. "So it feels like the term crypto has really outgrown its usefulness as a term," he said — it now carries too many ideologies and promises at once — and asked what the actual value-adding innovation is underneath it.
Flament's answer was two innovations, not one. The first is settlement without an intermediary: "But I think within that, the most transformational thing is actually enabling to have the ability to send truly peer-to-peer over the internet without having to have a central party to be able to send value."
The second is Ethereum: "And with Ethereum, you could actually code smart stuff on a blockchain."
The mechanism she gave is that the instruction and the money stop being separate. In the existing system — her example is Swift — the message telling a bank to move money and the movement of the money itself are two different things that have to be reconciled. On a blockchain they are the same event
"So I think that's really the real true transformation is the fact that with blockchain and with smart contracts, you can actually have smart money and therefore program it"
Kofinas drew the obvious extension: if fiat money can be moved programmably, so can a stock, gold or any other instrument. Flament agreed, and said that is what tokenization means
Colin defended the word crypto while agreeing it is loaded. "Crypto is a charged word, but it is still what is being used and that's still the core of it," he said — the cryptography and the key that unlocks the value are what make a decentralized system work at all
His caveat is that decentralization does not survive success. Any decentralized system that turns out to have useful properties gets colonized by large players and re-centralizes quickly, he said, and that is already visible: "Like the crypto space, in so long as it's a reinvention of financial markets, is already dominated by large players rather than decentralized at the individual level."
On what the field should be called, his answer was that it is not up to the three of them. He prefers programmable money, programmable capital or automating money, and thinks tokenizing financial assets is clear but does not reach people far from the industry
"We need Larry Fink and Scott Bessent to convert to that as well for it to become market consensus"
3. Two Layers Made Into One
Asked to explain in the simplest possible terms how the new architecture differs from the old one, Colin answered from his own experience running a pan-European startup accelerator and the special purpose vehicles that pooled investors' capital into companies.
When a portfolio company is acquired, two separate systems have to be reconciled by hand. "What you realize doing that is that two different layers coexist without interacting much except through the humans that are managing the whole thing," he said
"One layer is financial, that's what happens on the bank accounts" — the acquirer wires money to the vehicle, which then has to wire it on to shareholders
"And then you have another layer, entirely independent, which is the legal layer" — what the contract says about how the money splits, whether there is carried interest, which expenses are reimbursed first
The human manager does the arithmetic and sends instructions to the bank
The claim is that programmable money welds the two together. "I think what crypto or tokenization or programmable money brings about is the possibility to plug one of those two layers into the other and make them work as one, the legal layer and the financial layer," Colin said. Money arriving triggers a contract already loaded into the system as code, which splits it and pays the shareholders on the rules agreed when the vehicle was formed
Kofinas asked why the industry has so many separate blockchains. "There's like 150 of those, right?" Colin said, and the reason is that each generation fixed a limitation of the last: "Some were not fast enough. Some didn't have privacy. Some were not user-friendly enough and so on and so forth."
Flament's view is that the field is consolidating and that a blockchain is plumbing, not a proposition. "To me, blockchains have always been just like an infrastructure," she said, and Ethereum and Solana are where she sees the traditional financial system actually moving
She expects a few winners plus specialized chains for payments and for banks, and named the objection banks and central banks raise — whether an open-source, decentralized system can be trusted
Her answer inverts it: "I think you can trust something that's open source and decentralized way more than something that's closed"
4. The 1970s Ran This Play
Kofinas asked them to place their recent post, The Great Financial Reset Has Begun, inside the thesis they have been building for a year and a half. Colin's answer started with Carlota Perez, the British-Venezuelan economist whose 2002 book Technological Revolutions and Financial Capital argues that "technological revolutions happen approximately every 70 years by bringing about a new technology that provides the opportunity of reinventing how we produce, how we consume, how we work."
The phase that matters is the last one. "And the last phase is called the maturity phase, is when the new technology is not so new," Colin said. The companies that harnessed it are big and tired, and "The markets are plateauing and growth is not as strong as it used to be"
What a country does then is "you need to pull different levers, not technological levers, but other levers"
The previous maturity phase was the 1970s, the end of what Perez calls the age of oil, automobiles and mass production, which began with the assembly line in Detroit early in the twentieth century. Colin noted that everyone remembers the decade from history books as stagflation, social unrest and political upheaval
What he wants read alongside that is the financial invention. "And if you go through a list of everything that was invented or emerged during the 1970s, it's mind blowing in terms of financial innovation," he said, and gave the list in order:
"So it starts with something known as the Nixon shock, when the US decides to cut the link between the dollar and gold. That's 1971."
"A few years after that, Michael Milken invents the junk bond market, thus providing an abundant source of capital for many, many things, including something else that was kind of invented in the 1970s, leveraged buyouts."
KKR is founded at the end of the decade, when Jerome Kohlberg's two younger partners recognize that what he had been doing by hand at small scale was a way to deploy capital into mature companies and force extra productivity out of them
"Something else that was invented by then was the Bloomberg terminal." It became standard on every desk in the 1980s: "It made it possible to exchange information and to do trading much faster in a much more efficient way."
"Then you have a few regulatory inflection points such as what is known as May Day on the New York Stock Exchange in 1975" — the end of fixed brokerage commissions
"And about a decade later in London, there's something known as the London Big Bang," which he described as Britain writing the regulatory framework to capture everything finance had just become, and which made London the system's second hub
He came back later with one he had missed: "Oh, by the way, one that I forgot was the invention of passive investing. The 1970s is also the launch of Vanguard by John Bogle." He tied it to retirement saving being replaced by institutionalized investment, more so in the US than in Europe
The conclusion is a prediction about now. "And so fast forward to today, and sorry for the long answer, but if you assume, as I do, that we've now reached the maturity phase of the current economic paradigm, which I call that of semiconductors, computing and networks, then that maturity phase should give birth to a new financial system"
"And so if I have this conviction, then I look everywhere for signals that the financial system is changing," he said, which is what the newsletter has been collecting
5. Why Bretton Woods Broke
Kofinas asked for the underlying cause of Nixon ending convertibility, not the proximate one of gold reserves draining — and then for the mechanism by which that unlocked so much financial invention at once.
Colin gave two answers and credited the first to Martin Wolf on Odd Lots. "So I have two answers and maybe Marieke will have other ideas, but one answer I heard from Martin Wolf on an episode of the Odd Lots Podcast, I think last year, and he was saying like the US had spent so much for the Vietnam War and for Lyndon Johnson's great society in the 60s, end of the 60s, that normally it would have had to devalue the dollar to adjust for having spent so much and restore balance in the system"
"But because it was humiliating for the hegemon that the US was to devalue its own currency, especially since the dollar was really the anchor for the whole international financial system, Nixon just said, now we won't devalue" — and let exchange rates float instead
The second answer is about arithmetic and came from Mike Green, the first guest on the Currency of Power podcast. "But essentially, what he says is that you can't encode the entire economy on hard assets because hard assets, by definition, have a limited volume," Colin said — they lack elasticity
"So if you pick one hard asset and the economy is productive, at some point, there will be tension because you'll need more money to reflect all that additional value brought about by productivity, and the hard assets in limited volume won't be enough to encode the whole thing"
Kofinas supplied the consequence for anyone who has not heard the argument before: "If you don't have an elastic currency, the cost of borrowing money becomes punitive and that reduces the potential for growth, and that's essentially the insight." The economy then goes into deflation and an opportunity is missed
Colin's general rule is that hard-money regimes are ended by success, not failure. "And so that's why every regime that relied on some hard asset, whether the gold standard or the Bretton Woods regime, which was a gold standard by proxy of the dollar, was ultimately brought to an end, not because it didn't work, but because the economy grew so much thanks to technology mostly that we had to let go of the hard asset and find something else to encode the economy"
His reading of 1971 specifically is that mass production had created so much value and so much widely distributed middle-class wealth in the US that all the gold in the world could not sustain it
Flament added the European complaint of the period, that the dollar's position amounted to an exorbitant privilege, and the question it forced: if a fiat currency is backed by nothing, what is it actually backed by
"And so you have also like within this timeframe, the birth of a petrodollar system," she said — one answer being that the dollar became a claim on energy
Kofinas' correction is that the expected devaluation never came. "So there was a broad expectation that Nixon's de-pegging of the dollar from gold would lead to a de-valuation, a long-term de-valuation and loss of that exorbitant privilege. But in fact, by de-centralizing the international financial system, the dollar actually became stronger."
"And to your point about the petrodollar, what we saw was capital recycling back into the United States, driving the value of the dollar up so high, in fact, the international governments needed to come together under the Plaza Accords in 1985 to drive the dollar value down"
Flament's parallel is that stablecoins do the same outsourcing job. "Tether is a perfect example of that. There are people anywhere, everywhere in the world, as long as they have actually a digital wallet, they can have dollars in their pocket."
"And I think the strengths in a way of the dollar has always been to believe that outsourcing its currency is a better mechanism rather than actually strengthening it" — let it circulate, and dictate the rules because it is your money circulating
The pair have not settled which analogy fits: "Are stablecoins actually something different? And they're like the money for compute, because compute is the new oil, right?"
6. Why The Dollar Sticks
Kofinas said the common picture of the dollar — something Uncle Sam issues and the rest of the world could simply decide to stop taking — is inaccurate. "It is a lingua franca. It's like English. The rest of the world speaks English. No one forces them to speak English," he said, and asked what actually makes it sticky.
Colin pointed at an episode of their own podcast: "Yeah, I can't remember, but we went through a detailed list of everything that makes the dollar so enduring and sticky in our podcast interview with Jess Hoversen a few weeks ago." Two reasons came out of it
The first is network effects, and his illustration is the language one. "Like if I'm transacting with a counterparty in Brazil, they speak Portuguese, I speak French," he said — the two languages are close, and they will still end up in English
The financial version is depth: transacting in euros or reais may be too complicated or too risky because the market is not deep enough to hold an exchange rate for the life of the trade. "So maybe we'll switch to the dollar which is known, safe, liquid, et cetera."
"You don't need any permission to use dollars or to speak in English"
The second is the rails. "The other factor, which was the conclusion of our discussion with Jess, was that the financial rails matter a great deal," Colin said — how easy the existing plumbing makes it to use one currency for one transaction
"And because the dollar is so massive, there have been so many investments in the infrastructure that supports the dollar across the world" it is the default. He conceded the euro may be close enough on convenience inside the eurozone
Flament's version splits the same point into availability and liquidity, and says both are what stablecoins are recreating. The rails have been built over decades and they reach everywhere
"There is very deep liquidity. So it's almost endless." Wherever you are in the system, including remote places, there is a counterparty
"It's going to take a long, long time" to change that, she said, because a challenger faces the same problem any network faces: "But if anyone would want to start that, it's a cold start thing, right?" You can build the rails and have nobody arrive, or arrive and find no liquidity
Kofinas added the piece he thinks gets missed when people look at US public finances and ask who would want to own the debt. "Well, the primary reason that people want to own US government debt is not because they think it's a better long-term investment than, I don't know, gold or art or something else, but because they need it." Anyone with dollar liabilities has to manage them, and Treasuries are where that is done
7. Four Dates That Set It Up
Asked what today's equivalent drivers are, Flament went through what she called modern history.
2008 is two things at once: the financial crisis and the birth of Bitcoin. "So one, 2008, financial crisis, also the birth of Bitcoin, right?" she said, leaving open whether they are causally related, and dating peer-to-peer value transfer from there
2014 is the one she thinks is underrated. "And in 2014, actually, when Russia invades Crimea, and then there is sanctions that are being put on Russia, that's a wake-up call for many in actually the world" — and the country watching hardest was China
The question it raised was "So how do we build something that's independent and self-sufficient?", which is where Colin's idea of a full-stack, self-sustaining society comes from
"Part of that is actually building the rails and having rails that are independent and that no one has oversight with and can cut"
COVID settled the argument about whether money would be digital. Flament said the lockdowns forced an acceleration of everything digital that removed the doubt rather than answering it
The fourth is Trump's return and the legislation that followed it. "And with Trump Come Back, the Genius Act and all the laws are basically starting to emerge and are being put in place to actually also fully embrace technology with the understanding that actually the dollar has power through network effect, but that the money of the future is technology and that therefore this is actually an instrument that is actually really important to protect"
Colin added an older and slower one, and it is a trade fact rather than a financial one. "I would add an older episode, which is, I think, when the US ceased to be a surplus nation and became a deficit nation from a trade perspective and current account perspective," he said, citing Ray Dalio on the rise and fall of empires
"And basically what he explains is that when the empire stops being a net exporter and becomes a net importer, which happened to the US some time between 1976 and 1982, it's also the 1970s"
His reading of Trump being elected twice on a trade agenda is that reindustrializing America and ending being ripped off implies the dollar ceasing to be the reserve currency, trade barriers going back up, and the 1976-to-1982 trend reversing
Dalio's other point, in Colin's telling, is that the empire turns predatory toward its partners first — Canada, Europe, South Korea — and that "But he says the last thing that gives in the imperial construct is the reserve currency. That's the very last thing that will still be in place when all the rest is gone."
The historical case for that lag is sterling, which Colin took from the geopolitical analyst Marco Papic. "Britain ceased to be the largest economy in the world at the end of the 19th century," overtaken by the US, and the pound stayed the reserve currency until the end of the Second World War
The list of what it took is the point: a world war that battered Europe, a return to the gold standard and then leaving it again in 1931, a second world war, and a bombed-out Britain. "You needed all that for the pound sterling to cease to be the reserve currency."
"The dollar, if you extrapolate from that, following Marco's reasoning, the dollar is here to stay for a few more decades, but the signs that its demise will happen at some point are already here if you know where to look"
8. Why They Turned Cautious
Kofinas put it to them directly that, reading a year and a half of their work, both seem to have grown less certain that American financial hegemony will last as long as they first assumed. Flament agreed.
The first reason is a distinction their own work forced on them. "And I think actually that distinction is very important because as Nicolas say, you could continue to be a reserve currency, but maybe some other stuff is being used in trade, right?" she said — being the reserve asset and being the settlement currency are two separate jobs, and she sees China testing the second
The second is how deeply entangled the dollar already is, including in the places assumed to be escaping it. "But the reality is that if you go to Hong Kong, which by the way is the key door from China to the rest of the world, if you go to Hong Kong, the Hong Kong dollar is pegged to the dollar. Like there's a fixed rate. That's it. It's pegged."
The third is the view from inside Washington, which is where stablecoins fit their thesis. Flament's framing is that if you are a US policymaker asking what the next financial innovation should be, stablecoins carry the instruments you would want — including oversight, freezing and seizure, which she said are part of the dollar's power in the first place
What she will not put a number on is the pace: how fast the transition can be is uncertain
Colin's own summary was the shortest thing he said all hour: "Definitely not, you know, it's catchy to make a headline like de-dollarization is there. I'm like, well, hang on, it's going to take way longer."
Kofinas closed the hour by listing what he wanted to take up next: what has actually consumed the Trump White House's energy against what was expected of it on financial re-regulation, the likelihood of debasement and capital controls, whether rising Treasury yields reflect concern about US finances or simply the pull of the AI trade, and machine-to-machine commerce as the next dominant layer of the economy
Bonus Insights
Kofinas flagged machine-to-machine commerce as the driver the guests had not named, and the one he considers primary: once automated systems have to transact with each other, he asked whether a new financial system becomes necessary by definition rather than by choice
Colin has been on Hidden Forces before and was at the show's Genius Retreat on the Greek island of Syros; this was Flament's first appearance
The collaboration is older than the newsletter — Colin was Flament's advisor while she ran the digital neobank, and she credited him with bringing macro framing and lessons from other industries into hers
Flament's day job now is advising rather than operating: she sits on boards and writes, and named a European stablecoin consortium, N26 and IG Group among the companies she works with
Colin's framework draws on Carlota Perez's phases of a great surge of development, and the 2002 book is the source he keeps returning to
Their bottom line is that the reset is real and the timetable is not: the same maturity-phase conditions that produced fifteen years of financial invention in the 1970s are present now, and stablecoins are the candidate — but the dollar's rails and liquidity are deep enough that the change plays out over decades, whatever the headlines say.
Products, Companies & Tools Mentioned
Circle and USDC (Where Flament started in financial technology; the dollar stablecoin whose launch she worked through)
Tether (Flament's example of the dollar being outsourced again: anyone with a digital wallet anywhere can hold dollars)
Ethereum and Solana (The two chains Flament says the traditional financial system is actually moving onto; Ethereum is where smart contracts made programmable money possible)
Bitcoin (The subject of the argument that started the collaboration in 2018, and in Flament's timeline the other event of 2008)
Swift (Flament's contrast case: the message instructing a payment and the payment itself are separate systems that have to be reconciled)
N26 and IG Group (Among the companies Flament advises or sits on the board of)
Vsquared Ventures (The Munich deep-tech fund where Colin is head of research)
KKR and Vanguard (Two of the 1970s inventions on Colin's list — the leveraged buyout firm founded at the end of the decade, and John Bogle's passive fund)
Bloomberg Terminal (Launched at the end of the 1970s and on every desk by the 1980s; Colin's example of a financial tool that changed the speed of the market)
New York Stock Exchange and the London Stock Exchange (May Day in 1975 ended fixed brokerage commissions; the London Big Bang a decade later rewrote the rules around what finance had become)
Books & Resources Mentioned
Currency of Power – Marieke Flament and Nicolas Colin (The newsletter this conversation is built on, including the post The Great Financial Reset Has Begun)
Drift Signal – Nicolas Colin (His personal newsletter, and where the Bitcoin interview that started the collaboration ran)
Technological Revolutions and Financial Capital – Carlota Perez (The 2002 book behind Colin's whole framework: revolutions roughly every 70 years, each ending in a maturity phase)
Late-Cycle Investment Theory – Nicolas Colin (The framework he has built out of Perez's phases, linked from the episode page)
The Changing World Order – Ray Dalio (The rise-and-fall-of-empires argument Colin uses for the surplus-to-deficit turn and for the reserve currency being the last thing to go)
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