1,000 Argentinian pesos alongside a 100 US dollar bill . (Photo by LUIS ROBAYO / AFP) (Photo by LUIS ROBAYO/AFP via Getty Images)
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Recent reactions to US policymaking and tariffs have contributed to a decline in the dollar’s value, leading some to reexamine its role as the world’s safe-haven currency. The debate coincides with another shift, which is the growing emergence of cross-border payments infrastructure that seek to move money across borders without interacting with US currency or payment systems.
At the moment, the US dollar still dominates global cross-border trade. According to the most recent data from the IMF, US dollars made up 57% of the world’s total foreign exchange reserves in Q3 2025, meaning it is still the world’s large reserve currency, though this share has gradually declined over time – from 71% in Q1 2000. Overall, the US dollar accounted for 89% of global FX volumes in April 2025, according to the Bank for International Settlements.
Even as its share of global reserves have declined, the dollar is still deeply embedded within global payments infrastructure, with the US owning and operating the pipelines through which most of the world’s global payments flow. US-based correspondent banks enable international payments to be settled in dollars via US-based financial systems, such as the Federal Reserve’s gross settlement system Fedwire or the Clearing House’s Interbank Payments System (CHIPS), with the latter clearing and settling $1.9tn in domestic and international payments daily. Visa and Mastercard maintain a global lead on card spending, with both together processing trillions of dollars in payments annually.
Having said this, new alternative payment rails and infrastructure are emerging, indicating a shift away from systems and currencies owned and influenced by the US. Geopolitical pressure and the threat of sanctions are driving countries to explore alternative infrastructure – but will this have an impact on the USD’s cross-border dominance?
Non-US payments infrastructure is developing
Many commentators have suggested that China could pose the biggest challenge to US global payments systems. The Cross-Border Interbank Payment System (CIPS), backed by the People’s Bank of China, is designed to clear and settle cross-border transactions in the Chinese yuan. CIPS has seen significant growth, with average daily volumes of RMB 772.1bn ($110.7bn) in January 2026, a 24% increase compared to the previous year.
However, the potential challenge from CIPS is often overstated. While the system is compared to Swift, the two essentially perform different functions, with CIPS still relying on Swift to send messages between banks for a large proportion of transactions. CIPs is more similar in function to the US’s CHIPS, but settles only a fraction of the amount currently passing through the latter system.
Other alternative payment rails are emerging in countries aiming to reduce the influence of the US dollar specifically within their focus regions. In 2024, the BRICS bloc – which includes China alongside Brazil, Russia, and India and a number of other member countries – announced BRICs Pay, a decentralized digital payment platform to specifically connect national and commercial payment systems across BRICS+ nations.
Countries within BRICS have built fast domestic payment systems, such as Brazil and India’s digital payment methods Pix and UPI, with the latter now being connected to other systems across borders to allow Indian travellers to easily pay for goods abroad. Russia has built its System for Transfer of Financial Messages, its alternative to Swift after being banned from the system in 2022.
Similarly, other regional payment systems in Southeast Asia are increasingly linking their domestic real-time payment networks to facilitate cross-border flows without US intermediaries. Africa has also launched its own payment systems designed to enable cross-border transactions using local currencies, including the Pan-African Payment and Settlement System and more recently the Common Market for Eastern and Southern Africa’s Digital Retail Payments Platform (DRPP).
New rails could create more fragmentation in payments
While a number of alternative payment rails are emerging, they alone are not likely to significantly challenge the US dollar’s dominance in global trade. Although political factors are currently putting the dollar under pressure, its power has historically been linked to several factors, namely the high liquidity and maturity of the US’s financial market and the strong demand for USD in supply chains.
Building new rails will not change the makeup of global currency usage quickly. Swift is the global messaging system spanning 11,500 banking institutions across more than 200 countries. It continues to carry a large share of USD-denominated payments through US banks and financial institutions, and far exceeds the scale and reach of competitors. Focusing on the payment messages delivered through Swift in January 2026, USD payments accounted for 49.7%; though this is down slightly from 50.2% the previous year, the dollar is still by far the largest currency passing through this major payments system, ahead of the euro (which accounted for 22%), the British pound (7%) the Japanese yen (3%) and the Chinese yuan (3%).
The move to develop new payment systems may enhance the role of other currencies within specific regions, but many of the projects to do so are either in their early stages, focused on domestic payments or focused on specific contextual corridors.
For example, within China, the role of the US dollar for cross-border transactions has been impacted by policies and initiatives targeting dedollarization. In 2025, the yuan’s share of non-bank outbound cross-border payment volumes was 53.9%, while the US dollar’s share was 40.5%. In other words, while China’s currency usage globally is still small, it is now extremely significant within the country’s own flows.
One question hangs over the potential impact of stablecoins on the US dollar. On the one hand, if non-USD-backed stablecoins scale meaningfully, this could diversify the currencies used in settlement. However, most stablecoins in use currently are USD-denominated, and US policy – most notably the GENIUS Act signed into law last July – is latching onto stablecoins’ potential to increase the amount of USD held in central bank reserves.
What new alternative rails are doing is enabling more local currency settlement to reduce reliance on US-controlled infrastructure. While this is not likely to significantly impact the US dollar’s value on cross-border payments in the short term, it signals a move towards a more fragmented system for payments across borders and reflects a much slower shift to a broader range of reserve currencies over time.
