🇸🇦 THE “SAUDI ARABIA QUITS mBRIDGE” STORY NEEDS CONTEXT The headline makes it sound like Saudi Arabia has suddenly abandoned the alternative payment architecture developing around China. That’s not what happened. 🇸🇦 SAMA says it completed its planned mBridge proof of concept on 13 May 2025 and then ceased being a formal participant. That happened more than a year ago. What’s new is the disclosure. 🇨🇭 The BIS had already “graduated out” of mBridge in October 2024 after the project reached Minimum Viable Product stage and transferred it to the participating central banks. The BIS says its incubation role was complete. 🇺🇸 The FT separately reported US pressure over concerns mBridge could weaken dollar and SWIFT sanctions leverage. Both accounts should be distinguished. But mBridge continued developing without the BIS and Saudi leaving mBridge did NOT mean Saudi returned to a dollar only architecture. 🇸🇦🇨🇳 Saudi still has a RMB50bn swap agreement with the PBoC, Chinese banking relationships and access to expanding RMB settlement infrastructure. 🇸🇦 It is simultaneously integrating GCC payment infrastructure. This isn’t simply the petrodollar being replaced by the petroyuan. It isn’t SWIFT being replaced by mBridge either. It increasingly looks like one dominant global financial network becoming multiple interoperable nodes. Now look at Iran. 🇺🇸🇦🇪🇪🇬 The US is targeting the UAE branches of Egypt’s state owned Banque Misr over alleged Iranian shadow banking activity. 🇹🇷🇮🇷 Turkey has revoked the licence of Iran’s Bank Mellat branch. 🇴🇲🇮🇷 But Oman is interesting. The Central Bank of Oman still lists Bank Melli Iran and Bank Saderat Iran as licensed banks. 🇴🇲🇮🇷 At the same time, Oman and Iran are negotiating arrangements around navigation through the Strait of Hormuz. So I’m watching whether Iran’s financial rails are being compressed rather than completely isolated. 🇨🇳 China remains the enormous external economic node. 🇴🇲 Oman remains an important Gulf banking and diplomatic bridge. Other Iranian routes remain, so there isn’t enough evidence to say Iranian trade is being deliberately funnelled exclusively through China and Oman. But if other Iranian financial nodes keep getting squeezed while Oman remains intact, that becomes increasingly significant, especially alongside the Hormuz negotiations. This fits the framework I’ve been discussing. 🇺🇸 The Western node can become more digitally dollarised through stablecoins, tokenised Treasuries and programmable dollar infrastructure. 🇨🇳 The Chinese node can expand RMB settlement through CIPS, swap lines and alternative payment infrastructure. Regional nodes can increasingly settle directly. CBDC infrastructure can connect central bank money without requiring some imaginary single BRICS currency. 🇸🇦 Saudi can therefore remain dollar pegged, issue dollar debt, own US assets. 🇸🇦🇨🇳 At the same time it can maintain RMB liquidity, Chinese banking relationships, GCC payment integration and the knowledge gained through mBridge. That isn’t necessarily Saudi choosing China over America. It is Saudi building optionality between nodes. And this is why “petrodollar vs petroyuan” misses the bigger change. 🇨🇳 CIPS volumes are growing rapidly, but CIPS volume does NOT equal oil settled in yuan. There isn’t sufficient evidence to claim the petroyuan has replaced the petrodollar. What may be eroding is something subtler. The dollar’s exclusivity as the settlement rail. 🇺🇸 The dollar can remain dominant while alternative rails grow underneath it. 🇨🇳 RMB settlement can grow without the RMB becoming the global reserve currency. 🇮🇷 Iran can increasingly use Chinese and regional rails without a BRICS currency. mBridge can continue without the BIS or Saudi Arabia formally participating.