According to Russian Times (RT), a Russian state-controlled media agency, the BRICS nations (Brazil, Russia, India, China, and South Africa) are planning to introduce a gold-backed trading currency. The Russian government has confirmed this plan. “BRICS is set to introduce a new currency backed by gold, in contrast to the credit-backed US dollar, with the decision coming a month ahead of the bloc’s summit in Johannesburg. With the growing initiative, more and more countries are lining-up to join the group”, reported RT.
The introduction of the new gold-backed currency by the BRICS+ group of nations is expected to begin on August 22, 2023. This follows years of development. The BRICS gold-backed currency is seen as the next phase in the ongoing de-dollarization trend. It aims to provide an alternative to the dominant fiat currencies and boost the gold market.
Central banks worldwide have been buying gold to diversify their reserves away from the U.S. dollar. The introduction of a gold-backed currency by the BRICS nations aligns with this trend. Establishing a gold-backed currency could offer long-term support for gold and bring stability to the global economy. However, it is uncertain how the currency will be implemented and its impact on the global fiat money system.
Some analysts remain doubtful about the announcement, stating that the BRICS nations may not have enough gold to significantly back a currency. Additionally, the specifics of the implementation and the currency’s role in international trade are yet to be revealed.
However, it is important to note that this De-dollarization move by BRICS comes amid the debt crisis of the United States. Several countries like Belarus, Thailand, Pakistan, Turkey, Greece, Nigeria and many more countries are thinking about joining the BRICS as China and Russia are encouraging De-dollarization all across the world.
