BRICS: 130 Nations Move Toward CBDC, US Dollar at Risk

December 26, 2023

With the growing de-dollarization trend among BRICS nations and the overall digitization of finance, 130 countries are moving toward issuing a Central Bank Digital Currency (CBDC), which could put the US dollar at risk. Additionally, the BRICS currency, which is expected to be announced in the coming year, could only add to the international pressure on the greenback.

More Than 130 Countries Working on CBDC Development Amid BRICS Currency Creation

Throughout 2023, the BRICS alliance and the US dollar were major newsmakers. The former had set off significant geopolitical implications with its various de-dollarization plans. However, the BRICS alliance's projects may not be the only threat to the Western-based currency.

Research indicates that within the context of BRICS activity, 130 countries are progressing towards implementing a Central Bank Digital Currency (CBDC), posing a potential risk to the dominance of the US dollar. Additionally, this advancement coincides with ongoing efforts towards a currency project within BRICS. Speculation abounds regarding the possibility of this project also involving a digital asset utilized independently.

Furthermore, according to a recent survey by OMFIF, 41% of Central Banks anticipate having a fully operational Central Bank Digital Currency (CBDC) within four years. This potential acceleration could significantly increase the prevalence of these digital currencies worldwide. Consequently, countries globally might increasingly favor their local currencies, moving further away from reliance on the US dollar.

Already, over 11 nations have initiated their CBDC trials, with the digital yuan achieving notable success earlier this year. With the rising popularity of such currency alternatives, the dollar's supremacy in international transactions could indeed be at risk.

Undoubtedly, 2024 emerges as a pivotal year for the US dollar. De-dollarization efforts in the global south appear unrelenting. Additionally, the participation of US allies like Saudi Arabia and the UAE in these initiatives could inflict irreversible damage on the currency.