> ## Content Index > Fetch the complete content index at: https://finformed.uk/llms.txt > Use this file to discover other available public pages before exploring further. # Is the dollar collapsing? What the people who hold it are actually doing - URL: https://finformed.uk/is-the-dollar-collapsing/ - Published: 2026-10-31T23:03:23.000Z - Updated: 2026-11-01T02:19:22.000Z - Description: Every few weeks a video says the dollar is finished. Here’s what the world’s central banks are actually doing with $13 trillion, and the blind spot in the data. - Author: Ja’Van Edwards - Tags: Macro and markets, Claim checks, #the-dollar-system, The Weekly **The 30-second version** - **The claim:** “The dollar is collapsing as the world’s reserve currency.” - **Verdict:** Partly supported. - **What’s true:** the dollar’s share of the world’s reserves has been sliding for 25 years. - **What isn’t:** it’s not collapsing, and China isn’t the main winner. - **What nobody’s telling you:** the real story is in what the data leaves out. --- Every few weeks a new video goes viral telling you the dollar is finished. BRICS will replace it. China will replace it. Gold will replace it. Get out while you can. So let’s skip the predictions and look at the people whose decisions actually settle this question: the world’s central banks. Between them they hold $13.22 trillion in foreign currency reserves. Every quarter, the International Monetary Fund collects what currencies those reserves are held in. That data is public, it’s free, and almost nobody who tells you the dollar is collapsing ever shows it to you. Here it is. ### Why this matters to you Central banks hold reserves to defend their currencies, pay for imports and calm their markets in a crisis. Most of the dollars they hold are parked in US government bonds. That steady, enormous demand helps keep America’s borrowing costs low and the dollar strong. If it disappeared quickly, you’d feel it in mortgage rates, the price of gold and what your pounds are worth on holiday. Whether the dollar is “collapsing” isn’t a debate for economists. It reaches your bank balance. ### What the data shows **1\. The dollar is still in a league of its own.** At the end of June 2026, the dollar made up **56.70%** of the world’s allocated reserves. The euro, in second place, had **20.60%**. The Japanese yen had **4.96%**. China’s renminbi, the currency we’re told is replacing the dollar, had **2.11%**. **2\. But the slide is real, and it’s been going on for a quarter of a century.** Around the year 2000, the dollar made up **more than 70%** of the world’s reserves. By 2024 it was **57.8%**. That’s a fall of more than 12 points in about 25 years: steady, persistent, and slow. Barely half a point a year is erosion, not collapse. **3\. Some headlines are written about money that never moved.** In the first quarter of 2026, the dollar’s share *rose*, to 57.13%. The IMF says about half of that rise came from exchange rates, not decisions. When the dollar strengthens, the dollars central banks already own are simply worth more, so the dollar’s share goes up without anyone buying a single extra dollar. In the second quarter, the share fell to 56.70%, and this time it was real: central banks were actively buying euros. One quarter says “dollar comeback”, the next says “dollar decline”, and neither tells you much on its own. **4\. China isn’t where the money went.** This is the part that surprises people. IMF researchers traced where the money leaving the dollar actually went. Only about **a quarter** went into the renminbi. The other **three-quarters** went into the currencies of smaller economies that have rarely been used as reserves before. The dollar isn’t being replaced by a rival. It’s being nibbled at by many small ones. **5\. Outside the vaults, the dollar is even stronger.** Reserves are only one test. In April 2025, $9.6 trillion of currencies changed hands every day, and the dollar was on one side of **89.2%** of those trades. Nearly nine in every ten. ### The strongest argument against our verdict Here’s the blind spot. **These figures don’t include gold.** If a central bank sells dollars and buys gold, the dollar’s share of *currency* reserves can barely move, because gold isn’t counted in the total at all. So “the dollar still holds 57%” could be hiding a quieter shift: countries stepping away from currencies altogether. Central banks have been buying gold. How much, who is buying, and whether it’s really a vote against the dollar is the subject of Part 3\. It may change how you read everything above. ### What we don’t know - **Who’s selling.** The IMF publishes world totals, not individual countries. We can see the tide but not the boats. - **Revisions.** The first-quarter figure was published as 57.13%, then quietly revised to 57.18%. Never build a big claim on one quarter’s number. - **Choice versus price.** In any single quarter it’s hard to separate deliberate decisions from currency swings. The 25-year trend is far more reliable than any one headline. - **Gold.** It’s outside this data completely. See above. ### The verdict **Partly supported.** The dollar’s share of world reserves is falling and has been for 25 years: supported. The dollar is “collapsing”: not supported. China is taking its place: not supported by this data. The dollar still holds more than half of all reserves and sits on nearly nine in ten currency trades. The honest headline isn’t “the dollar is dying”. It’s this: the world is slowly, quietly spreading its bets, and most people are watching the wrong rival. ### Next Thursday Reserves are what central banks *hold*. But a currency’s real power is in what the world *uses*: to price oil, settle trade and move money across borders. **Part 2: Is dollar dominance actually declining, and by how much?** We follow the money through trade invoices, global payments and the currency markets, and find out whether the dollar’s grip is loosening where it really counts. *Subscribe to The Weekly so it lands in your inbox on Thursday morning.* --- *Finformed is independent research. Not financial advice. Spotted an error? Reply to this email and I’ll correct it at the top of this piece, with the date.* **Sources** 1. IMF, *Currency Composition of Official Foreign Exchange Reserves* (COFER), 2026 Q2 data brief, 30 September 2026\. [https://data.imf.org/en/news/imf%20data%20brief%20september%2030](https://data.imf.org/en/news/imf%20data%20brief%20september%2030?ref=finformed.uk) 2. IMF, COFER 2026 Q1 data brief, 1 July 2026\. [https://data.imf.org/en/news/imf%20data%20brief%20july%201](https://data.imf.org/en/news/imf%20data%20brief%20july%201?ref=finformed.uk) 3. IMF COFER, US dollar share of allocated reserves, annual series 1995–2024 (via DBnomics). [https://db.nomics.world/IMF/COFER/A.W00.RAXGFXARUSDRT\_PT](https://db.nomics.world/IMF/COFER/A.W00.RAXGFXARUSDRT%5FPT?ref=finformed.uk) 4. Arslanalp, Eichengreen and Simpson-Bell, *The Stealth Erosion of Dollar Dominance*, IMF Working Paper 22/58, 24 March 2022\. [https://www.imf.org/en/publications/wp/issues/2022/03/24/the-stealth-erosion-of-dollar-dominance-active-diversifiers-and-the-rise-of-nontraditional-515150](https://www.imf.org/en/publications/wp/issues/2022/03/24/the-stealth-erosion-of-dollar-dominance-active-diversifiers-and-the-rise-of-nontraditional-515150?ref=finformed.uk) 5. Bank for International Settlements, *Triennial Central Bank Survey: OTC foreign exchange turnover in April 2025*, 30 September 2025\. [https://www.bis.org/statistics/rpfx25\_fx.htm](https://www.bis.org/statistics/rpfx25%5Ffx.htm?ref=finformed.uk)