2025-09-19
In 2025, BRICS nations are testing symbolic "bank notes" and expanding local-currency trade. Nearly half of intra-BRICS trade is already being settled outside the dollar. However, does this imply that the supremacy of the US dollar is coming to a close?
The immediate answer is no. A single BRICS currency that dethrones the dollar remains highly unlikely in the short term as the dollar still accounts for 58–60% of global reserves.
However, practical change will occur gradually, with an increase in trade settled in local currencies, the use of regional payment systems and alternative settlement methods, alongside slow adjustments in reserve distributions.
The global monetary order is not static. Since the mid-20th century, the US dollar has dominated global trade and reserves. However, geopolitical conflicts, sanctions, and the rise of China have accelerated the push for BRICS de-dollarisation in 2025.
In 2025, the BRICS group (expanded beyond the original five) had advanced projects like a BRICS payment system, trial cross-border settlement solutions, and public representations concerning a potential shared currency.
This raised a key question: could BRICS de-dollarisation 2025 reshape world trade?
BRICS activity in 2024–25 is best described as "practical experimentation" rather than launching an immediately fungible global currency. The main developments:
Members are settling more intra-BRICS trade in national currencies. Bilateral swap lines and local-currency invoicing now support almost half of BRICS trade. [1]
The group endorsed a BRICS payment platform and tested blockchain-based systems to reduce reliance on Western banking infrastructure.
In mid-2025, BRICS distributed symbolic notes. Officials clarified these were political signals, not legal tender. [2]
Sanctions on Russia have encouraged barter deals, such as wheat-for-vehicles trades, highlighting BRICS' willingness to bypass dollar-clearing systems.
The central bank in China has expanded gold holdings and promoted its currency settlements. In 2025, the renminbi represented roughly 50% of intra-BRICS trade but will still constitute a minor portion globally.
Any replacement of the dollar faces three massive barriers:
The dollar dominates since trade documents utilise it, and pricing and financial markets revolve around the dollar.
Deep US Treasury markets provide the world with the ultimate safe asset and liquid reserve. That depth cannot be replicated overnight.
Currency acceptance depends on institutions: contract law, payment finality, dispute settlement, and central bank credibility. Shifting to a new currency requires trust that payments will settle reliably across jurisdictions.
The SWIFT network and dollar FX markets offer unmatched depth and security.
Shifts will be gradual, partial, and sector-specific. [3]
As mentioned above, a real usable BRICS currency, a single synthetic currency used across ten or more heterogeneous economies, faces tall barriers:
BRICS members have very different inflation regimes, growth cycles, and monetary frameworks.
Aligning policy would require unprecedented coordination, or a supranational institution with actual independence and credibility (unlikely in the near term).
A shared currency would require fiscal transfers or labour mobility, mechanisms that BRICS lacks.
Consider the reasons that led to the euro needing many years of legal and institutional development; BRICS currently does not possess that level of depth and political determination.
Major Western economies would not passively accept a rival reserve currency without political and economic pushback.
In early 2025, for example, the US signalled protectionist responses (including tariff threats) to any BRICS steps perceived as deliberately undercutting the dollar, elevating geopolitical risk for members exploring alternative settlement models.
Such threats raise the potential economic costs of swift de-dollarisation.
The more realistic path is a multipolar payments landscape, not a single BRICS note replacing the dollar.
Not true. Symbolic notes and pilots do not create instant global acceptance.
China's financial depth helps, but other factors, such as legal frameworks, reserve markets, and allied acceptance, matter equally.
These are stopgap or niche tools. Barter is costly and hard to scale; crypto lacks the liquidity and legal acceptance of sovereign reserve assets. [4]
Reduced Transaction Costs: Lower exposure to dollar conversion fees.
Bolstered South-South Trade: Boosts intra-developing-economy commerce.
Mitigated US Dollar "Weaponisation": Limits vulnerability to sanctions.
Technological Innovation: Blockchain trials simplify payments.
Lack of Currency Convertibility: Many BRICS currencies remain less liquid internationally and are subject to capital controls.
Political and Economic Divergence: Varied economic policies, governance standards, and geopolitical interests complicate monetary integration.
US Dollar Financial Infrastructure: The global financial system is deeply entrenched in the dollar network, not easily replaced.
Market Trust and Stability: BRICS currencies lack long-term stability credentials.
No. Symbolic banknotes exist, but there is no official BRICS currency.
In 2025, projections indicate that almost half of intra-BRICS trade will be conducted in local currencies, particularly the Chinese yuan and the Indian rupee.
Not in the short term. The US dollar still makes up around 58–60% of global reserves and is the most liquid and trusted trade currency.
BRICS payment platform pilots (including blockchain).
Bilateral currency swaps.
Local-currency invoicing.
Symbolic notes.
Gold demand rises as BRICS diversify reserves, and commodities like oil are increasingly priced in non-dollar terms.
In conclusion, BRICS is committed to reducing dollar dependence and has progressed from discussions to implementing pilot systems and actual settlement alterations. However, substituting the dollar isn't a simple yes-or-no situation.
The true contest is not one BRICS currency versus the dollar, but whether yuan settlement, gold-backed reserves, and blockchain rails can wither dollar dominance.
For traders, monitoring USD/CNY, USD/INR, and gold CFDs offers opportunities to capture volatility as BRICS de-dollarisation unfolds.
Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
[1] https://www.ey.com/en_in/insights/tax/economy-watch/brics-2025-growth-and-trade-promoting-initiatives
[2] https://www.omfif.org/2025/07/brics-currencies-are-no-realistic-alternative-to-the-dollar/
[3] https://www.coinworld.com/news/paper-money/brics-reveals-potential-currency-of-the-future
[4] https://www.reuters.com/business/finance/wheat-chinese-cars-russia-turns-barter-skirt-sanctions-2025-09-15/
