The BRICS countries, comprising Brazil, Russia, India, China, South Africa, and new members like Egypt and Saudi Arabia, are intensifying negotiations to launch their own currency for internal trade, targeting implementation by 2026. The initiative, discussed at the Rio de Janeiro summit in July 2025, aims to reduce reliance on the US dollar, which hit R$5.38 in August 2025, and strengthen the bloc’s economic sovereignty. Led by Brazil, the proposal responds to geopolitical tensions and US dominance in the global financial system. Experts note that the project faces technical challenges but is showing concrete progress.
The proposal gained prominence after President Luiz Inácio Lula da Silva advocated, on August 12, for a payment system eliminating dollar conversion. The bloc, representing 46% of global GDP in purchasing power parity, is betting on technologies like blockchain to enable fast transactions. The initiative does not aim to replace the dollar globally but to create an efficient alternative for intra-bloc trade.
- Main objectives of the project:
- Reduce international transaction costs.
- Protect against financial sanctions.
- Promote local currencies in trade.
- Enhance economic integration.
The progress comes amid dollar volatility and the BRICS’ expansion, now including 19 countries.
Payment system in focus
The BRICS Pay platform, under development, is central to the project. It will enable direct transactions in local currencies like the real, yuan, and rubles, without dollar conversion. In 2025, 90% of intra-bloc trade already occurs in local currencies, up from 65% in 2023, per SWIFT data.
Brazil, leveraging its Pix experience, leads the creation of a digital system inspired by central bank digital currencies (CBDCs). The proposal includes pilot tests between Brazil, China, and Russia in 2026, focusing on efficiency and security.
International reactions to the project
The initiative faces US resistance. In July 2025, former President Donald Trump threatened tariffs of up to 100% on BRICS products if the currency advances. He called the project a threat to the dollar, which dominates 84% of global transactions.
Lula reiterated that the proposal is not anti-American but aims for greater financial autonomy. China, with the yuan in 50% of bloc transactions, supports the initiative, but tensions with India complicate agreements.
The project also addresses concerns over financial sanctions, like those imposed on Russia post-2022. An alternative system would shield the bloc from external instability.
Proposed currency models
The BRICS evaluates three formats for the new currency: a digital system based on CBDCs, a model tied to commodities like gold and oil, or a unit of account inspired by the IMF’s Special Drawing Rights (SDR).
The BRICS Pay platform will use blockchain for fast, low-cost transactions. The bloc’s central banks are testing digital currencies, with China leading the yuan digital implementation.
The New Development Bank (NDB), chaired by Dilma Rousseff, funds projects in local currencies, supporting the transition. About $30 billion was released by the NDB in 2024, per bank reports.
Implementation barriers
Financial integration faces significant hurdles. Economic differences among members, like China’s trade dominance, raise concerns about imbalances. Harmonizing monetary policies is another challenge, especially between China and India.
- Key identified barriers:
- Political divergences within the bloc.
- Macroeconomic instability in some countries.
- Private sector resistance.
- Complexity of multilateral agreements.
Brazilian exporters fear losing flexibility in global transactions, while central banks need mechanisms to prevent debt accumulation in the system.
Advances in local trade
While the currency is not yet implemented, the BRICS already adopts alternative measures. Bilateral agreements, like between Brazil and Argentina, allow payments in reais and pesos. The NDB expanded funding in local currencies, reducing dollar reliance.
The Kazan summit in 2024 solidified the BRICS Bridge, a digital payment system laying the groundwork for BRICS Pay. The inclusion of new members, like the United Arab Emirates, strengthens the bloc’s influence.
Global financial landscape
The proposal reflects growing global monetary diversification. IMF data show dollar reserves dropped 5% since 2020, with currencies like the yuan gaining ground. The dollar’s volatility, recorded at R$5.38 in August 2025, reinforces the search for alternatives.
The BRICS also responds to the “weaponization” of the dollar, used by the US for sanctions. An own system would cut transaction costs by up to 20%, per estimates, and boost the bloc’s export competitiveness.