But lately, the rumblings from the Global South have turned into a roar. The BRICS alliance—originally Brazil, Russia, India, China, and South Africa, now expanded to include heavy hitters like Iran and the UAE—is openly discussing a divorce from the dollar. They want a currency of their own, or at least a payment system that bypasses New York.

Headlines would have you believe the greenback’s days are numbered. But if you peel back the rhetoric and look at the economic plumbing, the reality is far more complex. Is the BRICS currency a lethal threat to American financial hegemony? Probably not. Is it a signal that the world is fracturing? Absolutely.

To understand the challenge, you have to respect the champion. The dollar isn’t just a currency; it’s a network effect.

Roughly 60% of global foreign exchange reserves are held in dollars. About 90% of all currency trading involves the dollar. When a company in India buys oil from Saudi Arabia, the transaction is almost certainly settled in U.S. dollars. This creates what economists call "stickiness." Everyone uses the dollar because everyone else uses the dollar.

Furthermore, the U.S. offers something the BRICS nations currently cannot: deep, transparent, and liquid financial markets. If you are a central bank sitting on billions in excess cash, you buy U.S. Treasuries because you know you can sell them in a heartbeat. You trust the rule of law in the U.S. more than you trust the unpredictable policy shifts in Beijing or the sanctions-hit economy of Moscow.

If the system works, why break it?

The primary driver isn’t economics; it’s geopolitics. The U.S. has increasingly weaponized the dollar through sanctions. When the U.S. and Europe froze Russia’s central bank assets following the invasion of Ukraine, it sent a chill down the spines of other nations. The message was clear: If you cross Washington, your money isn’t safe.

For China and Russia, de-dollarization is a matter of national security. For other emerging markets, it’s about frustration. They are tired of their economies holding their breath every time the U.S. Federal Reserve raises interest rates. They want a multipolar financial world where the U.S. doesn't hold the only set of keys.

However, wanting a new currency and actually building one are two very different things.

For a BRICS currency to work, these nations would need a degree of economic integration that currently doesn't exist. The Eurozone works (mostly) because its members share a central bank and relatively similar political systems. The BRICS nations are a mismatched group of democracies, autocracies, and monarchies with vastly different economic interests.

There is also the elephant in the room: trust.

For a BRICS currency to challenge the dollar, India would have to trust China. Given their border disputes and strategic rivalry, that’s a tall order. Furthermore, would Brazil want to peg its economic fate to Russia’s war economy? Would the wealthy Gulf states want to anchor their assets to a currency dominated by Beijing?

Then there is the "China Problem." The only BRICS economy large enough to anchor a new currency is China. But to have a global reserve currency, you generally need open capital markets. You have to let money flow in and out freely. China, which strictly controls capital flight, has shown zero interest in doing this. You cannot have a global currency if you don't allow the globe to access it freely.

So, is the threat real?

If you are looking for a "Pearl Harbor" moment where the dollar collapses overnight and we all start paying in "BRICS-coin," the answer is no. The plumbing of the global economy is too deep, and the alternatives are too flawed.

However, if you define the threat as a slow erosion of dominance, then yes, it is happening.

We aren't moving toward a world where the dollar is replaced, but rather a world that is more fragmented. We will likely see a "bloc-based" economy. Western trade will remain dollar-denominated. Meanwhile, China and its partners will increasingly settle trade in Yuan or a bilateral digital currency system, bypassing SWIFT entirely.

The dollar’s slice of the pie will get smaller, not because it crashed, but because the BRICS nations are building their own private table in the corner of the restaurant. The dollar will remain the global anchor for the foreseeable future—not because it is perfect, but because, as the old saying goes, it is the cleanest shirt in the dirty laundry basket.