Elon Musk has criticized the United States for “overplaying” its use of the dollar as a tool of sanctions, leading more countries to reduce their reliance on the currency.
Musk pointed out that a growing number of nations are shifting toward conducting transactions in their national currencies, particularly within BRICS nations.
He emphasized that this shift is driven by necessity rather than choice, as Ukraine-related Western sanctions against Russia have limited dollar-based transactions and forced countries to explore alternative options.
Musk highlighted that countries like Brazil and India still want to engage in trade with Russia but cannot do so in dollars due to sanctions, leading them to de-dollarize their transactions; this, in turn, weakens the dollar’s global standing.
The weaponization of the dollar, as seen in sanctions, has prompted many nations to seek alternatives as it has effectively cut off Russia from the Western financial system.
Economists have previously warned about the consequences of the dollar’s dominance and aggressive U.S. economic policies, suggesting that more countries may shift away from dollar-based transactions in favour of local currencies.