Humanoids, Automation and the Dollar: How Industrial sovereignty is reshaping monetary sovereignty

At first glance, the development of humanoid robots and the depreciation of the U.S. dollar appear to belong to two distinct worlds. On one side, a fascinating technological narrative dominated by artificial intelligence, industrial automation, and the promise of unprecedented productivity gains. On the other hand, a more traditional macroeconomic analysis centered on interest rates, capital flows, relative growth, and foreign exchange markets.

And yet, these two dynamics are deeply interconnected.

Economic history shows that monetary dominance is never a purely financial phenomenon. Ultimately, it rests on something far more tangible: the ability of a country or a bloc to produce, export, impose standards, and structure global value chains. The dominant currency is rarely the primary cause of power; it is its reflection.

In this context, the rise of the Industrial Internet of Things (IIoT), advanced robotics, and, more recently, industrial humanoids represents far more than a technological revolution. It signals a structural realignment of global productive power, with direct, yet often underestimated, implications for the international monetary system and for the role of the U.S. dollar.

As the greenback experiences in 2025 its sharpest depreciation in more than fifty years, and as its safe-haven status is increasingly questioned by international investors, another transformation is unfolding in parallel: the rise of an automated productive infrastructure, largely dominated by China.

This paper therefore, proposes a cross-cutting perspective:

👉 What if tomorrow’s monetary battle is not primarily fought in central banks, but in smart factories, robotized supply chains, and the technological standards of 21st-century industry?

 

The end of a Dollar super-cycle

The U.S. dollar has just passed a historic turning point. In the first half of 2025, the dollar index fell by approximately 11%, marking its steepest decline since 1973. This correction signals the end of an upward cycle that began in the early 2010s, during which the dollar appreciated by nearly 40%.

It is important to emphasize that this dynamic does not reflect a sudden collapse of the dollar system. Rather, it points to a relative, gradual, but structural decline.

For more than a decade, dollar dominance was supported by:

• Superior U.S. economic growth
• Higher interest rates
• Deep and liquid financial markets
• Persistent inflows of international capital

This regime is now reaching its limits. Growth differentials are narrowing, the Federal Reserve is entering a rate-cutting cycle, and U.S. public debt has reached levels that increasingly raise questions about long-term sustainability should economic growth falter.

More subtly, foreign investors are beginning to hedge their dollar exposure, effectively selling the U.S. currency. This still-gradual movement could generate massive flows, given the more than $30 trillion in U.S. assets held by non-residents.

In other words, the dollar is gradually losing its status as an “asset without alternative.”

 

The exorbitant privilege and its limits

The status of global reserve currency grants the United States what Valéry Giscard d’Estaing famously called an “exorbitant privilege”: the ability to finance deficits by issuing its own currency. But this privilege rests on a fragile balance. To supply the world with sufficient dollars, the U.S. must structurally:

• Import more than it exports
• Maintain current account deficits
• Provide liquid financial assets to the rest of the world

This mechanism, known as the Triffin dilemma, works as long as the dominant economy retains clear productive, technological, and institutional superiority.

Over recent decades, however, the United States has progressively:

• Financialized its economy
• Outsourced part of its industrial base
• Increased its dependence on global value chains

It is precisely in this context that the industrial automation revolution emerges.

 

IIoT and humanoids: a productive, not merely technological, revolution

The development of humanoid robots, as analyzed by Morgan Stanley, should not be seen as a simple extension of traditional robotics. It represents a change of scale.

The figures are striking:

• A potential market exceeding $5 trillion by 2050
• Nearly 1 billion humanoids in circulation
• Around 90% dedicated to industrial and commercial uses
• Massive adoption in the second half of the 2030s

These humanoids are not designed to replace household assistants in the short term, but to integrate into existing productive processes. particularly in structured industrial environments.

Combined with IIoT, artificial intelligence, and smart manufacturing systems, they enable:

• Drastic reductions in production costs
• Continuous and flexible manufacturing
• Lower dependence on human labor
• Greater resilience to logistical shocks

In short, they make reindustrialization possible without reverting to the constraints of the 20th-century industrial model.

 

Productive sovereignty as the foundation of monetary sovereignty

Economic history is unequivocal: the dominant currency is almost always that of the dominant industrial power. The pound sterling prevailed when the United Kingdom was the workshop of the world. The dollar rose when the United States concentrated innovation, production, and value-added exports.

Today, advanced automation is redefining this equation.

Countries capable of mastering:

• Robotics
• Critical components
• Industrial software
• Production standards

will be able to produce locally, at scale, with superior efficiency.

This capacity mechanically reduces:

• Dependence on imports
• The need for external financing
• Exposure to currency fluctuations

Over time, less international trade implies less need for a universal settlement currency.

 

China, robotics, and monetary fragmentation

One of the most striking conclusions of the humanoid analysis is China’s central role. Beijing benefits from:

• Massive state support
• A near-autonomous supply chain
• Significant advantages in critical components (motors, batteries, reducers, sensors)

While the United States retains a strong edge in system design, certain software segments, and innovation ecosystems, it remains heavily dependent on Asian and, more broadly, emerging suppliers for large-scale industrial production. This dependence extends beyond China alone and reflects a broader network increasingly structured around the BRICS and BRICS+ countries.

This expanded industrial leadership gives these countries several strategic levers:

• The gradual setting of technological and industrial standards, particularly in robotics, IIoT, energy, and digital infrastructure
• The multiplication of bilateral and regional trade settled outside the dollar, often in local currencies or via clearing mechanisms
• A gradual reduction in collective exposure to the dollar, enabled by a more autonomous productive base and increasingly integrated South-South value chains

In this framework, de-dollarization does not take the form of a sudden or ideological rupture, but rather a pragmatic and opportunistic recomposition of the international monetary system. The BRICS are not seeking to impose a single alternative currency, but to reduce vulnerability to the dollar by leveraging their industrial, demographic, and energy weight. Productive autonomy, enabled in part by advanced automation, forms the silent yet decisive foundation of this strategy.

 

A self-reinforcing loop

Automation and dollar weakening feed each other:

1. Dollar depreciation encourages investment in real and productive assets
2. States accelerate investments in automation and IIoT
3. Production becomes more local and autonomous
4. International trade slows or regionalizes
5. Structural demand for dollars declines

This process is slow, but cumulative.

 

What this perspective still does not say

As compelling as this framework may be, it carries risks of overinterpretation and requires nuance.

First, the dollar retains structural advantages that are difficult to replicate. The depth and liquidity of U.S. financial markets, the rule of law, institutional transparency, and shock-absorption capacity remain unmatched. Even if China dominates certain industrial value chains, its financial system remains largely closed and tightly controlled, and is perceived as less reliable by global investors. At present, no alternative currency, neither the euro, the yuan, nor local-currency settlements within the BRICS, combines all the attributes required to fully replace the dollar as a global reserve currency.

Second, automation does not mechanically guarantee successful reindustrialization. Humanoids and IIoT require massive capital investment, highly skilled labor, abundant and affordable energy, and supportive regulatory frameworks. The United States still holds significant advantages in software innovation, advanced semiconductors, and entrepreneurial ecosystems. A late but rapid U.S. automation surge cannot be ruled out, potentially rebalancing industrial power.

Third, global trade may transform rather than contract. IIoT and robotics do not necessarily mean fewer exchanges, but different ones: more data-, software-, service-, and IP-intensive flows. These immaterial flows remain largely dollar-denominated. In this scenario, dollar demand would not disappear but shift toward other segments of the global economy.

Finally, a major geopolitical risk remains. The concentration of robotized value chains in China could prompt the U.S. and its allies to respond with aggressive industrial policies, trade restrictions, or tighter technology controls. Such fragmentation could paradoxically strengthen the dollar temporarily as a safe haven during periods of heightened tension.

These counterarguments underscore a key reality: the ongoing monetary and industrial transition is nonlinear, contested, and uncertain. The dollar is not vanishing, and automation does not mechanically redistribute power. But it is precisely in this in-between, marked by frictions, bifurcations, and strategic choices, that long-term trends take shape.

 

2030–2040 scenarios: currency, industry, and productive power

No single trajectory will dominate between 2030 and 2040. Automation, humanoid robotics, and monetary fragmentation are powerful forces, but their expression will depend on political choices, technological breakthroughs, and exogenous shocks.

Scenario 1 — Managed continuity: the Dollar adapts without losing centrality

The dollar remains the primary reserve currency, though less hegemonic and more pragmatic. The U.S. accelerates automation, partially reindustrializes critical chains, and preserves financial market attractiveness.

👉 Implication:
 The dollar remains dominant but more cyclical; investors diversify without abandoning U.S. assets.

Scenario 2 — Regional fragmentation: A multipolar, multi-currency world

Automation accelerates regional value chains. BRICS economies produce locally, trade increasingly in national currencies, and develop independent payment infrastructures.

👉 Implication:
 FX risk management becomes central; multiple regional currencies gain prominence.

Scenario 3 — Industrial sovereignty as a geopolitical weapon

Robotics, IIoT, and AI become explicit tools of power. Subsidies, export controls, and deliberate fragmentation increase.

👉 Implication:
 Higher currency volatility, rising importance of real assets, and a premium on industrial resilience.

Scenario 4 — Technological breakthrough and flow redefinition

Faster-than-expected adoption of humanoids leads to hyper-local, flexible production. Trade shifts toward data, software, and IP.

👉 Implication:
 The dollar remains important in financial and digital flows, but its link to goods trade weakens.

Scenario 5 — Systemic stress and accelerated monetary recomposition

Repeated crises erode confidence in fiat currencies. States and firms diversify away from dominant currencies and increase real asset holdings.

👉 Implication:
 Renewed focus on systemic risk management, gold, regional currencies, and strategic productive assets.

Future scenarios: Probability meets impact

Scenario	Description	Estimated Probability (2030–2040)	Impact on Investors
Scenario 1 – Managed Continuity	Dollar remains primary reserve currency, U.S. partially reindustrializes, automation progresses but no major disruption in trade.	30–35%	Dollar remains dominant but cyclical; diversification important; moderate risk, stable returns from U.S. assets.
Scenario 2 – Regional Fragmentation	Multipolar world, BRICS and emerging economies trade increasingly in national currencies, regional payment systems develop.	25–30%	FX risk management becomes critical; opportunities in regional currencies, infrastructure, and local production; portfolio diversification needed.
Scenario 3 – Industrial Sovereignty as Geopolitical Weapon	Countries use automation, IIoT, and AI as explicit geopolitical tools; export controls and deliberate value chain fragmentation.	15–20%	High volatility; real assets (energy, metals, infrastructure) gain value; resilience becomes a key investment criterion.
Scenario 4 – Technological Breakthrough and Flow Redefinition	Rapid adoption of humanoids leads to highly localized production; trade shifts to data, software, IP.	10–15%	Focus shifts to digital assets, intellectual property, platforms, and standards; dollar remains important in finance but less tied to goods.
Scenario 5 – Systemic Stress & Accelerated Monetary Recomposition	Repeated crises reduce confidence in fiat currencies; accelerated diversification toward real assets and regional currencies.	5–10%	Extreme scenario; strong emphasis on hedging, gold, strategic industrial assets; highest systemic risk, but also potential outsized opportunities.

 

Notes on probabilities:

• These probabilities are subjective, based on current trends, the pace of automation, geopolitical tensions, and historical resilience of the dollar.
• Scenario 1 is given the highest probability because U.S. advantages in finance and technology remain significant.
• Scenarios 4 and 5 are lower probability but high-impact, representing technological disruption or systemic crises.
• Probabilities are not additive to 100% strictly—they are ranges reflecting uncertainty and overlapping factors. 

Implications for investors: Changing the compass, not the bet

For investors, the key challenge is not to predict the disappearance of the dollar or to wager on a dramatic monetary rupture. The challenge is subtler: adapting analytical frameworks to a world where financial power increasingly stems from real productive capacity.

This implies several strategic shifts.

First, reducing implicit dependence on perpetual U.S. exceptionalism. This does not mean abandoning U.S. assets, but recognizing that their past outperformance was driven by conditions, superior growth, a strong dollar, and financialization, which may become more cyclical and less asymmetric.

Second, revaluing assets tied to production, infrastructure, and industrial sovereignty. Automation, robotics, IIoT, energy, industrial metals, critical infrastructure, and select real assets regain strategic importance, not as tactical trades, but as long-term pillars.

Third, integrating geopolitical and monetary dimensions more deeply into asset allocation. In a fragmented world, currency risk management, geographic diversification, and exposure to multiple economic blocs become structural drivers of risk-adjusted returns.

Finally, accepting that the dollar is no longer solely a yield or safe-haven asset, but also a political and cyclical one. It will remain central, but less exclusive, more contested, and more sensitive to underlying industrial balances.

👉 For long-term investors, the core question is no longer where the currency is going? but where is productive capacity being rebuilt, standardized, and monetized?

 

General conclusion: Currency always follows the factory

The transition underway is neither spectacular nor linear. It does not manifest as a dollar collapse nor the sudden rise of a new hegemonic currency. Instead, it unfolds as a gradual shift, often invisible in the short term, but decisive over decades.

Economic history teaches a constant: monetary sovereignty is always the consequence of productive sovereignty. Currencies dominate when the economies that issue them produce, innovate, export, and impose standards. They decline when this real base erodes, even if financial power lingers for a time.

Humanoids, automation, and IIoT are therefore not mere technological innovations. They are the invisible infrastructure of the next power cycle. Whoever controls smart factories, robotized value chains, industrial software, and technical standards ultimately controls more than productivity gains, they shape the very conditions of monetary credibility.

The dollar will not disappear. But it will evolve in a world where it is no longer the only default, no longer the sole obvious choice, a world more multipolar, more industrial, more fragmented, and paradoxically more grounded in reality.

👉 The central question of the 21st century is therefore not: Which currency will dominate tomorrow?

But rather:
Who is building today the productive infrastructure that will make a currency credible tomorrow?