In 2026, everyone is buying $MyDamnCome, so I'll start with a brief analysis.

At the beginning of 2026, the United States made a major news splash in Venezuela, and Greenland's heat is also rising. It seems to point to a question: after a temporary one-year truce on tariffs in 2025, the geopolitical focus of the US will shift to its nearshore issues.

In 2025, the US passed two bills: the "Big and Beautiful Act" and the "Genius Act." Both center around the issuance of more dollars and the expansion of US debt. Combining these, the plan is to bundle debt issuance with cryptocurrencies, with cryptocurrencies serving as credit backing for new US debt, avoiding damage to dollar credibility from monetary expansion. In 2026, this theme will continue, with US debt expansion ongoing, and the issue of credit backing for newly issued dollars will remain a focus throughout the year.

This explains the hot topics at the start of the year involving Venezuela and Greenland. Trump declared a state of emergency over Venezuela's oil revenue, and both Venezuela's oil and Greenland's resources can, like cryptocurrencies, serve as collateral for new dollars.

Once the collateral issue is resolved, the Federal Reserve will begin a bold rate-cutting process. Otherwise, premature rate cuts could further weaken the dollar's credibility, leading to a surge in non-sovereign credit currencies and many assets, potentially spiraling out of control.

Considering the current process, the existing $41 trillion debt ceiling will be reached by the end of April. In the first half of the year, there will be ongoing negotiations to raise the US debt ceiling further, along with the transition of the Federal Reserve Chair in May. If the collateral issue for the dollar proceeds smoothly, a significant rate cut of over 100 basis points could begin in the second half of 2026, along with rapid expansion of US debt.

If the nearshore issues do not progress smoothly and the collateral problem for the new dollars cannot be resolved, the rate-cutting process in 2026 may continue the indecisiveness of the previous two years. The entire year might see only two rate cuts totaling 50 basis points.

The US Dollar Index, which reflects the strength or weakness of the dollar relative to a major basket of currencies (excluding RMB), is expected to remain stable with a slight upward trend in 2026. The dollar's "smile curve" will enter its upward phase in the latter half of the year. The dollar will continue to strengthen.

This trend in the dollar will significantly influence other asset classes, including RMB-denominated assets, gold, and commodities. Understanding the logic behind dollar movements is paramount, which is why this is the first article in the 2026 annual outlook. Meanwhile, the US continues to manipulate and tighten the dollar, at least ensuring it doesn't lose.

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