Is the dollar really collapsing? Digging through BRICS media lately, this question keeps returning. Russia’s TASS and RT, China’s Global Times, cry in unison that “gold rises and the dollar falls.” I half-believe this narrative and half-filter it. Today I’ll split that “half” precisely—what is really cracking, what the dollar still stands on, and how it can be restored.
Gold Buying Is a ‘Symptom’ — the Real Event Is the Petrodollar’s Fracture
Central banks stacking gold is fact. In the World Gold Council survey, 89% expect gold reserves to rise over the next year, and gold’s share of reserves (~27%) has overtaken US Treasuries (~22%) for the first time since 1996. China’s central bank has bought for 17–18 straight months, amassing 2,313 tonnes.
But I read this gold buying as a “symptom,” not the “disease.” The real event unfolds beneath it—the fracture of the petrodollar system. For half a century, the world’s oil traded only in dollars. That “oil = dollar” formula was the true pillar seating the dollar on the reserve throne. Now that pillar is cracking. Today about 80% of oil trade is still in dollars, but the other 20% has slipped outside the dollar. Considering it was “effectively 100%” decades ago, this is a quiet but clear defection.
The Iran War Pulled the Trigger
The event that decisively widened this fracture was the 2026 Iran war. Multiple analyses name it the “definitive catalyst” of petrodollar erosion. Why? After the war, Iran effectively seized control of passage through the Strait of Hormuz. And it began collecting the tolls (up to $2 million per vessel) and oil payments not in dollars but in Chinese yuan or stablecoins (crypto)—the so-called “Tehran Toll Booth.” Some payments came in euros too.
One clarification. It’s often said “Iran sells oil for yen or gold,” but the confirmed settlement currencies are yuan and crypto (gold is part of the broader “gold-backed settlement” trend, not Iran’s actual oil-payment instrument). Either way, the point is the same—at a chokepoint where a fifth of the world’s oil passes, non-dollar settlement has been institutionalized.
I read this passage thus. The war, paradoxically, raised Iran’s geopolitical value. Having withstood the full US-Israeli assault and ended the war by agreement, Iran is now the “gatekeeper” holding the vital point of world energy—Hormuz. China backs it, having invested over $100 billion in Iranian energy and infrastructure. Of course the price was steep, losing Supreme Leader Khamenei, so Iran didn’t “win” outright. But it clearly now stands at the front line of non-dollar oil settlement. And other oil states are watching. The starting point of the petrodollar’s narrowing ground—I believe the first domino fell right here.
One principle for reading state media: separate fact from wish. “Gold purchase volumes” and “yuan settlement” are fact, but “imminent dollar collapse” is their wish. Yet don’t dismiss a wish—when a wish accumulates into the actions of many countries, it becomes the direction of reality.
So Does the Dollar’s Value Fall? — Yes, ‘As Countries Join’
Let me be frank. I think the dollar’s value does trend lower over the long run. Not that it crashes today. The key is “as countries join one by one.” A reserve currency’s power flows from the inertia that “everyone uses it.” But when one country starts selling oil in yuan, another swaps reserves into gold, and yet another settles bilateral trade in its own currency—each small, but together they thin that inertia. Over 80% of Russia-China trade already settling in rubles and yuan is one example.
This is like the first snowflake of an avalanche. One flake is nothing, but past a tipping point the whole mountain slides. The gentle curve of the dollar’s share falling from 80% to 70% to 60% eventually shifts the market’s “expectations.” The moment the belief that “the dollar is forever” cracks, part of the value that belief sustained drains away. Add cross-border settlement experiments linking central bank digital currencies (CBDCs), and the “technical bypass” around the dollar network widens too. So I grant BRICS media’s directionality. The issue is speed and timing, not direction.
Count the dominoes already fallen and the direction sharpens. Over 80% of Russia-China trade shifted to ruble-yuan settlement; Iran takes yuan and crypto at Hormuz; the BRICS New Development Bank pledged to raise local-currency lending to 30%. India and the UAE opened rupee-dirham direct trade, and reports keep coming that Gulf oil states are weighing yuan settlement. Each looks like an “exception,” but the moment these exceptions multiply into “practice” is the tipping point. I believe the world is stepping toward it—the catch being that the step is slow, measured in a decade-plus, not a few years.
But — the Dollar Is Still Robust
Here we must coldly see the other side. Right direction doesn’t mean “tomorrow.” The dollar is still overwhelmingly robust. 80% of oil still trades in dollars, and over half of global FX reserves are dollars. Above all, there is no fit candidate to replace it. The yuan can’t move freely due to China’s capital controls, so it struggles to be a true anchor; gold yields no interest and is too heavy for large-scale settlement. A BRICS gold-based currency like the “Unit” is still just a concept.
History teaches this balance too. “The death of the dollar” has been declared repeatedly. When Nixon cut gold convertibility in 1971, in the 1970s stagflation, at the 1999 euro launch, in the 2008 crisis—each time forecasts poured out that “the dollar is finished.” Yet half a century on, the dollar remains the center of world trade and finance. A reserve currency holds not merely by being “trustworthy” but through network effects—deep markets, abundant liquidity, a dense settlement web. That inertia doesn’t collapse overnight.
And BRICS is not one body. India never wants the yuan becoming a de facto anchor. China and India face off with rifles at the border. Outwardly united in “de-dollarization,” if the alternative is “yuan hegemony,” India pulls out first. Sharing an enemy doesn’t make an alliance. The force pushing the dollar out is real, but as long as it fails to converge on a single alternative, the dollar keeps its seat as “the best of the worst.”
The Dollar Has Plenty of Ways to Restore Its Value
So will America just watch the erosion? I think the dollar still holds enough cards to restore its value. Four of them.
First, energy superpower. The US is now the world’s largest oil and gas producer. As long as it takes dollars when selling its own oil, America itself can prop up one axis of the petrodollar. Second, the deepest capital market. In a crisis, the world’s money still rushes to US Treasuries. This depth of liquidity and safe assets isn’t replicated overnight. Third, restraint in sanctions. Ironically, overusing the dollar as a weapon fueled de-dollarization. Using that weapon sparingly is itself the start of restoring trust. Fourth, tech and AI demand. As long as the US is the center of AI, semiconductors and advanced industry, the world’s demand to join that ecosystem flows into demand for dollars.
Ultimately the dollar’s fate rests on “internal management” more than “external attack.” Keep fiscal discipline, restrain sanctions, bind allies with trust, hold the tech edge—and the erosion curve can be flattened or reversed. Hegemony rots within before it falls from outside. The dollar is no different. Conversely, if America runs its finances loosely, sprays sanctions, and lets politics splinter, the dollar’s trust erodes on its own even without a replacement. The dollar’s biggest enemy is not the yuan but Washington’s failure of self-management.
For Korea and Investors
Our story matters too. Interestingly, the Bank of Korea hadn’t bought gold for 13 years and only recently, reports say, opened an account to invest in gold ETFs. In a wave where the world’s central banks race to stack gold, Korea has lagged. There are reasons for caution given the nature of reserves, but factoring in the structural drivers of “the shadow of sanctions” and “the petrodollar’s fracture,” this lag isn’t something to view comfortably. The more a country lives on trade, the more it needs to prepare for a world of multipolar settlement currencies.
One thing from an investor’s view—this is observation, not advice. Central banks’ steady buying is powerful structural demand thickening gold’s “floor.” But that doesn’t mean “gold rises forever.” Gold still yields no interest and remains cyclical, swinging with real rates, the dollar and geopolitics. Getting excited by BRICS media’s “dollar collapse” headlines and chasing the top is entirely different from understanding why the petrodollar is fracturing and holding gold as one layer of risk. I watch this trend with the latter’s eyes.
My Conclusion — the End of Monopoly, Not Death
To sum up. What’s happening is not “the dollar’s death” but “the end of the dollar’s monopoly.” The world is shifting to a multipolar system mixing dollar, yuan, digital currencies and gold-backed settlement. In this flow, BRICS gold buying and Iran’s yuan settlement are signposts of direction. The direction is de-dollarization. The more countries join, the sharper that curve.
But direction is not destination. The dollar won’t collapse. There’s no replacement, and America holds the cards to turn it back. So I take both narratives only halfway. BRICS’s “the dollar falls” and the West’s “de-dollarization is a mirage” are each half right. The answer is somewhere between—an era where the dollar keeps the throne, but the crown is not as heavy as before. Gold is insurance quietly resting on that lighter crown, and Iran’s yuan settlement is the first bell announcing the change. Whether that bell is heard as “a signal of collapse” or “a warning to manage”—that’s up to Washington.
Frequently Asked Questions (FAQ)
That differs from the confirmed facts. Iran mainly takes Hormuz tolls (up to $2 million per vessel) and oil payments in yuan or stablecoins (crypto), with some euro payments. “Yen/gold settlement” is inaccurate; gold is part of the broader “gold-backed settlement” trend, not Iran’s actual oil-payment instrument. The point is that non-dollar settlement has been institutionalized at a key oil chokepoint.
The long-run direction is down, in my view. Not a crash, but a gradual erosion as countries one by one sell oil in yuan or swap reserves into gold, thinning the reserve currency’s “inertia.” Past a tipping point, market expectations shift and part of the value drains. The issue is speed and timing, not direction.
(1) 80% of oil still trades in dollars, and over half of FX reserves are dollars. (2) The yuan (capital controls) and gold (illiquidity) struggle to be replacements. (3) BRICS is internally split (India rejects yuan hegemony), failing to converge on one alternative. The force pushing the dollar out exists, but the lack of a replacement is the dollar’s strongest defense line.
Four cards: (1) status as the world’s largest oil-and-gas energy superpower, (2) the deepest capital market money rushes to in a crisis, (3) restraint after overusing sanctions as a weapon (restoring trust), (4) dollar demand created by tech dominance in AI and semiconductors. The dollar’s fate rests on America’s internal fiscal and policy management more than external attack.