BRICS Summit Aims to Dethrone US Dollar as World Reserve Currency: Could Bitcoin (BTC) Take Its Place?

• South Africa’s BRICS Ambassador, Anil Sooklal, asserts no intent to challenge the U.S. dollar’s global supremacy within BRICS.
• The approaching BRICS summit is already leaving its mark on local currencies, particularly the South African Rand.

U.S. Dollar’s Primacy Goes Unchallenged

In a realm where economic alliances often dictate currency dynamics, the BRICS group (Brazil, Russia, India, China, and South Africa) has always held a unique position. As the bloc hints at trading in native currencies for global transactions, questions arise about the future role of the U.S. dollar.

However, Anil Sooklal, South Africa’s BRICS Ambassador, delivered an unequivocal message on the topic. Although BRICS recognizes the potential of trading in their own currencies, such as the Chinese Yuan and Indian Rupee, Sooklal made it clear that they have no inclination to challenge the global dominance of the U.S. dollar.

“The dollar will continue to be a major global currency — that’s a reality,”

he affirmed.

Sooklal further emphasized that while the subject of local currency trade would be a focal discussion in the upcoming summit, it shouldn’t be conflated with the concept of de-dollarization. The aim isn’t to replace but to offer alternative avenues in global commerce.

Pre-Summit Dynamics: The South African Rand’s Noticeable Ripple

In anticipation of the BRICS summit, scheduled from August 22 to 24 in Johannesburg, local currencies are already experiencing significant ebbs and flows. A clear example is the South African Rand, which, according to Reuters, saw a noteworthy surge by 0.8% compared to its closing value the preceding Thursday.

While the Rand’s uplift might be heartening for many, it’s essential to acknowledge the currency’s turbulent trajectory over August, witnessing a 16% dip. The recent slump was partly attributed to apprehensions concerning China’s economic health, which holds significant trade ties with South Africa. Investors worldwide, having their gaze fixed on South Africa’s July inflation figures, are keenly observing these fluctuations.

The commitment of BRICS to promote local currencies, especially in a world dominated by few major currencies, is an essential step. While the alliance, undeniably, has shown a preference for the Chinese Yuan, it simultaneously ensures a comprehensive strategy that fosters growth and international use of all member nations’ currencies.