BRICS Gold-Backed Currency: What Launched
Key Takeaways
- The “Unit,” a gold-backed digital trade currency (40% gold / 60% BRICS currency basket), launched as a pilot in October 2025 with only 100 units issued - infrastructure testing, not dollar replacement.
- The US dollar’s share of global reserves stands at 56.9% (Q3 2025, IMF COFER) - down from 72% in 2001 but stable since 2022, declining at roughly 0.6% per year.
- China-Russia bilateral trade is now 99.1% settled in rubles and yuan (January 2026), but broader BRICS members have not committed to replacing the dollar.
- Gold reached $5,190/oz in March 2026 - exceeding original predictions - driven by geopolitical volatility, not BRICS currency anchoring.
- No gold-backed currency proposal in modern history has maintained its peg at scale. The Unit’s reserve value already declined from 100 grams to 98.23 grams of gold equivalent within two months.
Editor’s Note (March 2026): This article was originally published in June 2023, ahead of the BRICS Leaders’ Summit in Johannesburg. At that time, there was significant speculation about a gold-backed BRICS currency that could challenge the US dollar’s dominance. Three years on, the situation has evolved considerably. The August 2023 summit did not produce a new currency. A pilot “Unit” was launched in October 2025, but as a blockchain-based trade settlement instrument with only 100 units issued - far from the system-wide alternative originally envisaged. The analysis below has been updated to reflect what actually happened versus what was predicted, while preserving the original thesis about BRICS’ growing economic influence and the structural pressures on dollar dominance. Where original predictions have not materialized, we say so explicitly.
Is BRICS Creating a Currency to Replace the US Dollar?
Not yet - and the timeline has shifted significantly from original expectations. The BRICS bloc has not created a unified currency. What it has produced is the BRICS Unit, a pilot gold-backed digital currency for trade settlement (40% gold, 60% basket of BRICS currencies) launched in October 2025 with only 100 Units issued on the Cardano blockchain. This is infrastructure testing, not a dollar replacement.
The more consequential developments are bilateral: China-Russia trade is 99.1% settled in local currencies, and bilateral currency swap agreements have expanded across Brazil-China (yuan-real) and India-Russia (rupee-oil) corridors. However, these remain bilateral arrangements - not the coordinated BRICS-wide settlement system originally envisaged. India has explicitly stated it has “no policy to replace the dollar.”
There is an ongoing development that poses a potential challenge to the dominance of the US dollar in international transactions. The group of countries known as BRICS has been spearheading a monetary shift, aiming to reduce reliance on the dollar as a leading medium of exchange and reserve currency.
While the process itself bears some similarities to the rise of the US dollar under the Bretton Woods system in 1944 and the subsequent creation of Special Drawing Rights (SDRs) in 1969, it is important to note the distinguishing aspects. What connects these historical events, along with the current BRICS initiative, is the significance of gold - and the recurring question of whether a new international settlement instrument can be credibly anchored to it.
The BRICS bloc expanded in January 2024, with Egypt, Ethiopia, Iran, and the UAE formally joining. Saudi Arabia, notably, did not formally accede - it indicated interest but has not made a final decision. An additional 13 countries were invited as “partner countries” in October 2024. With these additions, the BRICS+ grouping now represents a formidable share of global economic activity.
BRICS vs G7: Key Economic Indicators
| Metric | BRICS+ (2025) | G7 (2025) | Source |
|---|---|---|---|
| Share of World Population | ~48% | ~10% | World Bank |
| Share of Global GDP (PPP) | ~41% | ~28% | IMF WEO April 2025 |
| GDP Growth Forecast (2025) | 3.4% | ~1.5% | IMF |
| Central Bank Gold Purchases (2025) | 863 tonnes (all central banks) | Net sellers | World Gold Council |
| Share of Global Wheat/Rice Production | ~50% | ~15% | FAO |
| Share of World Landmass | ~30% | ~16% | World Bank |
BRICS De-dollarisation: Predictions vs Reality
| What Was Predicted (2023) | What Actually Happened (by March 2026) | Source |
|---|---|---|
| Gold-backed BRICS currency launched at August 2023 summit | No currency launched. “The Unit” pilot launched Oct 2025: 40% gold / 60% currency basket on Cardano blockchain. Only 100 Units issued. | CCN, Insights on India |
| Saudi Arabia joins BRICS as founding expansion member | Saudi Arabia did NOT formally join. Four members joined Jan 2024 (Egypt, Ethiopia, Iran, UAE). 13 partner countries invited Oct 2024. | Carnegie Endowment |
| De-dollarisation reaches 50%+ of BRICS trade within 2-3 years | China-Russia trade: 99.1% in local currencies. Broader BRICS: bilateral agreements only. India explicitly stated “no policy to replace the dollar.” | CSIS, Chicago Policy Review |
| CIPS replaces SWIFT as global standard | CIPS processed RMB 175.49T ($24.47T) in 2024 (+24% YoY). Connects 1,829 participants across 130 countries. But still relies on SWIFT for 80% of messaging. | CSIS, PBoC |
| Dollar share of reserves drops below 50% by 2025 | Dollar share: 56.9% (Q3 2025). Down from 72% (2001) but stable since 2022. Decline rate: ~0.6% per year. | IMF COFER, Federal Reserve |
| Gold reaches $3,000-3,500/oz driven by BRICS currency demand | Gold reached $5,190/oz (March 2026). Exceeded prediction, but driven by geopolitical volatility and central bank purchasing, not BRICS currency anchoring. | Fortune, World Gold Council |
The momentum behind de-dollarisation continues, reshaping digital payment systems worldwide. George Yeo, the former Foreign Minister of Singapore, highlighted the growing global shift:
“I’m quite sure that among the big countries, China, Russia, and others, especially those in BRICS, there will be a push for an alternative system. Not to replace the current system, but to tell the US, ‘Look, don’t overplay this, because if you do, we have an alternative.’ It’s not as good, but we won’t be hostage to the current system.”
This sentiment is backed by concrete shifts in trade patterns. As of January 2026, Russia and China conduct 99.1% of bilateral trade in rubles and yuan. China made its first gas payment to the UAE in yuan in 2023, and currency swap agreements have expanded across multiple corridors. However, these remain bilateral arrangements - not the coordinated BRICS-wide settlement system originally envisaged.
The Unit: What Actually Launched
In October 2025, “The Unit” was launched as a pilot gold-backed digital trade currency. The structure: 40% physical gold, 60% basket of BRICS currencies (Brazil real, China yuan, India rupee, Russia ruble, South Africa rand - equally weighted). It was deployed on the Cardano blockchain with only 100 Units issued.
Why Gold? The Historical Precedent
The choice to anchor The Unit partially to gold is not arbitrary. Gold has been the default trust mechanism for international monetary systems since the 19th century. The Bretton Woods Agreement (1944) pegged the US dollar to gold at $35/oz, with other currencies pegged to the dollar. When that system collapsed in 1971 under the weight of trade imbalances and the cost of the Vietnam War, the world moved to floating exchange rates - but gold never lost its role as a reserve asset.
The IMF’s Special Drawing Rights (SDRs), created in 1969, attempted a different approach: a basket of major currencies without a gold component. SDRs function as a supplementary reserve asset and unit of account, but they never became a circulating currency or a meaningful trade settlement instrument.
The Unit attempts to combine both models - a gold anchor for stability and a currency basket for flexibility. The 40/60 split is designed to provide a gold floor while allowing the instrument to track the economic weight of BRICS member states.
The Unit’s Performance: What the Data Shows
The early data reveals the fundamental tension in this design. By December 2025 - just two months after launch - the reserve value had already declined from 100 grams to 98.23 grams of gold equivalent. The decline was caused not by movement in the gold price (which continued rising) but by volatility in the currency basket component.
This illustrates a structural problem: the currencies that comprise 60% of The Unit’s value - the ruble, real, rupee, rand, and yuan - carry significantly higher volatility than gold. The gold component stabilizes the instrument, but cannot fully offset the depreciation in the currency basket. A gold-backed instrument is only as stable as its non-gold components.
What Would a Viable Gold-Backed Settlement Instrument Require?
The Unit’s 100-unit issuance on Cardano is infrastructure testing, not a monetary system. For a gold-backed instrument to function at the scale needed to shift global settlement patterns, it would require:
- Physical gold reserves held by a trusted custodian (or network of custodians) with transparent auditing. At current prices ($5,190/oz), backing even $1 billion in trade settlement would require approximately 6,000 kg of physical gold.
- Redemption mechanisms that allow holders to exchange Units for physical gold or dollar-equivalent value. Without credible redemption, the “gold backing” is notional.
- Counterparty trust across BRICS member states with divergent geopolitical interests. Russia and India, for instance, have different strategic alignments; Brazil’s central bank has explicitly resisted any anti-dollar framing.
- Liquidity depth - 100 Units cannot price-discover. A viable settlement instrument needs a deep order book with continuous market-making.
None of these conditions exist today. The Unit demonstrates the concept but falls orders of magnitude short of the scale needed to shift global settlement patterns.
Gold-Backed Currency Proposals: A Comparison
No gold-backed currency proposal in modern history has maintained its peg at scale. The following table compares historical and current attempts:
| Proposal | Status (Sep 2026) | Backing Structure | Scale | Outcome |
|---|---|---|---|---|
| The Unit (BRICS) | Pilot - 100 units issued Oct 2025 | 40% gold / 60% BRICS currency basket | Cardano blockchain, 100 units | Infrastructure testing only. Reserve value declined to 98.23g gold equivalent within 2 months |
| Zimbabwe Gold-Backed ZiG | Launched Apr 2024 | Backed by gold + FX reserves | National currency | Lost ~43% of its value within five months as the Reserve Bank of Zimbabwe imposed a devaluation in September 2024 |
| Bretton Woods (USD) | Ended 1971 | USD pegged to gold at $35/oz | Global monetary system | Collapsed under trade imbalance pressure when gold redemptions exceeded US reserves |
| SDR (IMF) | Active since 1969 | Basket of 5 currencies (no gold) | Supplementary reserve asset | Functions as unit of account but never became a circulating currency or trade settlement instrument |
The pattern is consistent: gold-backed instruments face a fundamental trilemma between maintaining the peg, allowing sufficient liquidity for trade settlement, and managing the fiscal pressures that inevitably lead governments to abandon the gold anchor.
Payment Infrastructure: mBridge and CIPS
The most significant progress in BRICS-aligned payment infrastructure has come not from a new currency but from existing systems. mBridge, the multi-CBDC bridge project involving central banks of China, Hong Kong, Thailand, UAE, and Saudi Arabia (with 31 observer institutions), has processed $55.5 billion cumulatively across 4,000+ transactions - growth of 2,500x from the 2022 pilot - though 95% of settlement volume is in Chinese digital yuan (e-CNY).
CIPS (China International Payment System) processed RMB 175.49 trillion ($24.47T) in 2024, representing 24% year-over-year growth across 1,829 participants (210 direct, 1,619 indirect) in 130 countries. However, CIPS still relies on SWIFT for approximately 80% of its messaging infrastructure. It complements SWIFT rather than replacing it.
For detailed analysis of mBridge and reserve currency dynamics, see BRICS Currency vs USD: What’s Actually Happening to Global Reserves. For a full comparison of CIPS, SWIFT, and alternative payment systems, see Beyond the Dollar: Alternative Payment Systems Guide.
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What Gold-Backed Currency Proposals Mean for Portfolios
The original analysis was directionally correct on several fronts: BRICS expanded, de-dollarisation accelerated in bilateral channels, and gold prices surged well beyond the $3,000 target. Where it overstated the case was in expecting a coordinated, system-wide currency alternative by 2025-2026.
The reality is more nuanced. De-dollarisation is happening, but it is bilateral (China-Russia, China-Brazil), not multilateral. The dollar’s reserve share is declining, but slowly (0.6% per year) and from a position of structural dominance (56.9%). And critically for the gold-backed narrative: gold is rising for geopolitical reasons and central bank purchasing, not because BRICS has successfully anchored a new currency to it.
Gold as Hedge vs Gold as Currency Anchor
This distinction matters for portfolio construction. Gold at $5,190/oz is supported by central bank purchasing (863 tonnes in 2025 alone) and geopolitical demand - tangible, measurable drivers. Gold as a currency anchor, by contrast, would require a functioning redemption mechanism, deep liquidity, and political commitment that The Unit pilot does not demonstrate.
The Unit’s early value decline reinforces this: gold-pegged instruments inherit all the volatility of their non-gold components while adding the complexity of maintaining a peg. For portfolio purposes, direct gold exposure (physical, fractionalised precious metals, or commodity ETFs) delivers the hedging benefit without the structural risks of an experimental settlement instrument.
For investors and asset managers evaluating allocation strategies, the implications are:
- Gold as a portfolio hedge remains well-supported at $5,190/oz, driven by central bank purchasing and geopolitical demand. The case for gold rests on its established role as a store of value, independent of whether BRICS successfully anchors a currency to it.
- The Unit’s value decline demonstrates the difficulty of gold-pegged instruments. A 1.77% reserve value decline within two months - in a pilot with only 100 units and no market stress - signals design challenges that would amplify at scale.
- Tokenized precious metals offer a more direct route to gold-backed exposure. Unlike The Unit’s hybrid basket, tokenized gold instruments track the commodity price directly. For platforms supporting multi-asset exchange, these instruments provide the gold-backed exposure that investors are seeking without the currency basket volatility.
- Dollar resilience should not be underestimated. At 56.9% of global reserves with the deepest capital markets, the most liquid government bond market, and network effects across global trade, the dollar’s structural advantages remain intact for the foreseeable future.
The BRICS story is not over - but it is evolving from a dramatic “currency war” narrative into a pragmatic, bilateral, infrastructure-building process. The institutions best positioned are those with multi-rail, multi-currency infrastructure that can operate across both dollar-denominated and emerging local-currency settlement systems.
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BRICS Currency vs US Dollar: What Would Change for Portfolios?
| Factor | If BRICS currency gains traction | If dollar dominance persists | Current trajectory |
|---|---|---|---|
| Reserve diversification | Institutional demand for BRICS-denominated assets | Dollar assets remain default allocation | Gradual shift; dollar declining at ~0.6%/year |
| Trade settlement | Multi-currency corridors expand; FX hedging complexity increases | Dollar remains primary settlement currency | Bilateral (China-Russia, China-Brazil), not multilateral |
| Gold allocation | Gold anchoring drives structural demand above central bank purchasing | Gold remains cyclical hedge | Gold at $5,190/oz; central banks bought 863t in 2025. No successful gold-peg at scale |
| Tokenized assets | Gold-backed tokens and fractionalised metals gain traction as direct hedges | Traditional gold instruments (ETFs, physical) remain primary | Growing interest, but regulatory frameworks still developing |
| Platform requirements | Multi-rail, multi-currency infrastructure becomes essential | Single-currency platforms remain viable | Multi-rail already preferred by institutions seeking optionality |
Frequently Asked Questions
What Countries Are in BRICS and What Is Their Combined Economic Weight?
BRICS+ now includes the original five members (Brazil, Russia, India, China, South Africa) plus Egypt, Ethiopia, Iran, and the UAE, which joined in January 2024. An additional 13 countries were invited as “partner countries” in October 2024. Collectively, BRICS+ represents approximately 48% of the world’s population, 41% of global GDP (PPP), and roughly 30% of the world’s landmass.
How Would a BRICS Currency Affect Global Trade and Investment?
A fully functional BRICS currency would reduce dollar intermediation in trade between member nations, increase demand for BRICS-denominated financial instruments, and require platforms to support multi-currency, multi-rail settlement. However, the current trajectory points to bilateral arrangements rather than a unified currency. India has explicitly stated it has “no policy to replace the dollar.” The Unit pilot - with only 100 units issued and a declining reserve value - remains far from the scale needed to reshape global trade patterns.
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