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BRICS Plans New Currency: Could It Challenge the US Dollar?

Source: How Would a New BRICS Currency Affect the US Dollar? (2025-11-26)

The BRICS nations—Brazil, Russia, India, China, and South Africa—are actively exploring the creation of a new, blockchain-based currency to rival the US dollar, potentially backed by a basket of their currencies or gold. This move aims to diversify global reserve assets and reduce dependence on the US dollar, which currently dominates international trade and finance. Recent developments include discussions of a gold-backed "Unit" currency and a blockchain payment system, signaling a strategic shift in global economic power. While some leaders, like Russian President Vladimir Putin, have hinted at de-dollarization, official statements suggest BRICS is not seeking to fully abandon the US dollar or the SWIFT system but rather to create alternative financial infrastructure. In the broader context, the potential emergence of a BRICS currency could significantly impact global markets, influencing currency exchange rates, international trade dynamics, and geopolitical relations. As of late 2025, the global economy is witnessing increased interest in digital currencies, with central banks worldwide exploring CBDCs (Central Bank Digital Currencies), which could facilitate or hinder BRICS' plans. The US dollar remains resilient due to its deep liquidity, widespread use, and the strength of US financial markets, but the push for a new BRICS currency reflects growing economic multipolarity. Recent facts include: 1. The BRICS nations collectively account for over 40% of the world's population and approximately 25% of global GDP, making their currency ambitions highly impactful. 2. The proposed blockchain-based payment system aims to facilitate faster, more secure cross-border transactions among member countries. 3. The idea of a gold-backed "Unit" currency is inspired by historical precedents of commodity-backed money, aiming to stabilize value amid global economic uncertainties. 4. The US dollar's share in global reserves has declined from over 70% in the early 2000s to around 59% in 2025, partly due to diversification efforts by other nations. 5. The International Monetary Fund (IMF) and World Bank are closely monitoring BRICS' financial initiatives, considering their implications for global economic governance. 6. Several emerging markets outside BRICS are also exploring digital currencies and alternative reserve assets, indicating a broader shift toward multipolar currency systems. 7. The US Federal Reserve continues to raise interest rates to maintain dollar strength, but persistent inflation and geopolitical tensions could influence future currency dynamics. 8. The development of a BRICS currency could accelerate the adoption of digital assets in international trade, potentially challenging traditional banking systems. 9. Experts warn that geopolitical conflicts and economic sanctions could either hinder or accelerate BRICS' currency plans, depending on how member nations navigate these challenges. 10. As global markets adapt, investors are advised to diversify portfolios and stay informed about currency and geopolitical developments to mitigate risks associated with potential shifts in reserve currency dominance. This evolving scenario underscores the importance of understanding international monetary policies, geopolitical strategies, and technological innovations shaping the future of global finance. Investors, policymakers, and businesses should monitor BRICS' progress closely, as the emergence of a new major currency could redefine economic alliances and investment opportunities worldwide.

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