Is the End of the Dollar as a Reserve Currency Near?

Vesela Todorova
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Vesela Todorova: University of National and World Economy, Sofia, Bulgaria

Ikonomiceski i Sotsialni Alternativi, 2019, issue 2, 107-123

Abstract: International currency serves international economic trade. It originated as a result of the internationalization of national currencies or as supra-sovereign currency. In the first case international currency is represented by currencies which perform monetary functions beyond the borders and outside the jurisdiction of the relevant issuer country. In the second case these are regional or global currencies, based on group agreements among the countries. The present study analyzes the nature of international currency and its inherent functions. Following the latest financial crisis, an urgent answer is sought to the question: Is it possible to substitute the American dollar with some other international currency without shocks to world economy? The author of the present article contributes to the aforementioned discussion by tracing the role of reserve currencies. The substitution of one currency with another is a natural process. The current world economic order, based on the supremacy of the dollar, is already losing ground. Is the world getting closer to the moment when the dollar will be dethroned as international currency in its dominant position? Which currency could substitute it? The author studies four main possibilities – the Euro, the Renmimbi, the “Ikon” currency and the Cryptocurrency – multilateral monetary system or world monetary system with a single currency in its dominant position.

Keywords: Anchor currency; International currency; Triffin dilemma; Means of payment; Unit of account; Store of value (search for similar items in EconPapers)
JEL-codes: E40 E42 F01 G10 G14 G18 (search for similar items in EconPapers)
Date: 2019
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