Catenaa, Tuesday, April 29, 2025-BlackRock CEO Larry Fink warned that rising US deficits and protectionist trade policies could undermine the US dollar’s position as the world’s reserve currency, as global efforts to de-dollarize gain traction.
“If deficits keep ballooning, America risks losing that position to digital assets like Bitcoin,” Fink said, sounding the alarm as federal debt surges to nearly 120% of the country’s annual economic output.
The warning comes amid heightened fears of de-dollarization, a trend championed by countries like China seeking alternatives to the dollar in global trade. Recent policy signals from the Trump administration may intensify that shift.
Since returning to office, Trump has pledged 100% tariffs on countries moving away from the dollar. His earlier tariff measures rattled both equity and crypto markets. On Thursday, the US Dollar Index (DXY) slipped to 98.30 — its lowest point this year.
“Trump’s trade and foreign policies have forced Europe on a path towards reduced reliance on the US,” said Jane Foley, head of forex strategy at Rabobank. “And this is likely to imply a desire for reduced reliance on the dollar.”
Still, analysts caution that dissatisfaction with the dollar does not guarantee de-dollarization. “The US will lose the reserve currency when there is someone out there to take it away. Right now, there isn’t an alternative,” said Steve Ricchiuto, chief economist at Mizuho Financial Group.
While Fink’s remarks reflect Wall Street’s growing concerns, experts say the dollar’s long-term dominance may rest on how US policymakers address debt and whether viable global alternatives truly emerge.
