Gold in a Multipolar Currency Regime

For now, the U.S. dollar still reigns supreme as the world’s reserve currency. But cracks in this hegemony are widening, and in the wake of de-dollarization, there’s a golden opportunity for the yellow metal to re-emerge as a neutral global reserve asset in a multipolar currency regime. 

As nations like China, India, and Russia challenge the dollar’s monopoly, the rise of a multi-currency world underscores why physical gold is not just a hedge, but a strategic necessity.

The dollar’s dominance, cemented by the 1944 Bretton Woods agreement, has rested on its role as the primary medium for international trade, oil pricing, and reserve holdings. Yet, its foundation is eroding. The U.S. national debt exceeds $33 trillion, with interest payments projected to hit $1 trillion annually next year. 

Decades of quantitative easing have bloated the Federal Reserve’s balance sheet, diluting the dollar’s purchasing power. Meanwhile, geopolitical tensions—sanctions on Russia, trade disputes with China—have further fed global de-dollarization. Now we have high inflation, interest rates that are still way too low, and a ballooning debt. In fact, almost half of new debt in 2024 came from interest payments on the debt itself. In that scenario, it would be impossible for other countries not to start considering de-dollarization more seriously.

That’s exactly what’s happening. Data from the International Monetary Fund (IMF) shows a steady decline in the dollar’s share of global foreign exchange reserves. Central banks keep stockpiling gold at a historic pace, especially in Poland and BRICS-aligned countries. As the rest of the world continues to lose trust in the dollar, they’ll bet on gold as a neutral, non-politicized asset.

Look at Treasurys: they’ve been swinging wildly since Trump’s trade wars began and are now sitting over 4.5%.  The dollar’s exorbitant privilege has always been unsustainable, and with the world increasingly realizing that we can’t fix our fiscal mess, a multipolar currency regime is an unfolding reality. 

As Peter Schiff recently said on X:

The yield on 10-year Treasuries is back up to 4.5% as the U.S. dollar resumes its broad-based decline. Despite the trade truce, the world is losing confidence in the dollar and our ability to get our fiscal house in order. The consequences of de-dollarization will be profound.

— Peter Schiff (@PeterSchiff) May 13, 2025

A multipolar currency regime envisions a world where no single national currency dominates. China is increasingly pushing for different ways to exchange yuan instead of dollars. Russia’s push for gold-backed trade with other BRICS nations is also accelerating the shift. The 2024 BRICS summit floated proposals for a gold-linked trade unit, a direct challenge to the petrodollar.

After years of exporting our inflation, taking advantage of cheap manufacturing elsewhere, and using the threat of war to enforce petrodollar supremacy, Trump claims we’re being “ripped off.” In reality, his policies are smashing through everything that has allowed America to enjoy our standard of living to begin with. Those are the same factors that have allowed the dollar to survive for so long.

As nations diversify away from dollar-denominated assets, gold’s share in global reserves is climbing. 

With the government’s culture of blatantly unsustainable borrowing trickling down to consumers, America’s unpayable debt cannot simply go on forever. Now other countries are not only realizing it, but acting on it. Though the story of unipolar dollar dominance was always bound to come to an end, in this case, the finale will be a spectacular collapse that upends the way of life Americans have become so accustomed to. 

2008 was nothing, and neither was the Great Depression, compared to the end of the dollar’s reign. The longer it gets put off, the worse it will be in the end. However, for better or worse, it may be coming soon. As Peter recently said on Metals and Miners:

“…stagflation, a combination of a weak economy and rising interest rates, is the one scenario that the Fed never stress tested any of the banks for…They did not run a stress test where you have a recession with high unemployment, but inflation and interest rates go up, not down.”

The IMF reports that gold now accounts for significantly more of total reserves than it did a decade ago. Other countries know that gold is the ultimate safe haven, not US Treasurys. As the multipolar world takes shape, the dollar’s decline could trigger volatility in equities, bonds, and real estate—assets that are tethered to the stability of the dollar.

Gold thrives in uncertainty. Its price has skyrocketed this year, outpacing inflation and most asset classes. However, its true value lies not in short-term gains, but in its role as a wealth preserver when currencies like the US dollar collapse under the weight of inflationary mismanagement and central planning hubris. 

As demand for dollars goes down it will devalue U.S. assets, particularly Treasuries, which foreign entities hold to the tune of trillions. As the dollar’s shadow fades, gold reclaims its role as the world’s ultimate store of value—unchained, enduring, and essential.