Russia's invasion of Ukraine has led to an unprecedented and hardly imaginable decision: the seizure of the Russian Central Bank's foreign currency reserves by the G7 countries. Of the $640 billion held, "we cannot use about 300 billion dollars now due to the circumstances," explained Russian Finance Minister Anton Siluanov, and the same goes for the euro. Whatever one thinks of sanctions in general, this questioning of the right of ownership over currency reserves marks an historic turning point.

It is a break comparable to the end of convertibility between the dollar and gold announced by Richard Nixon on August 15, 1971: the dollar lost its anchor to the precious metal and began to float. "You have the dollar," said the American authorities, "but its value is no longer guaranteed, it's over". President Nixon's Treasury Secretary, John Connally, came up with this saying: "The dollar is our currency, but it's your problem." Now, the very possession of dollars is no longer absolutely certain.

The trusting relationships between nations on the monetary front are broken. By questioning the possession of dollars, isn't the United States shooting itself in the foot? All countries that hold dollars now know that if they displease Uncle Sam, their reserves can vanish in an instant. Will China, which holds $3.4 trillion in foreign exchange reserves, and which has its eye on Taiwan, not seek to reduce this amount?

The dollar, the world's leading reserve currency, will lose its credit. A monetary "deglobalization" will take place. Moreover, for several years, China has been trying to impose its yuan on trade within the Asian zone. The Wall Street Journal tells us that it is negotiating with Saudi Arabia to fix the price of part of its oil sales in yuan. China buys a quarter of the oil that the black gold country exports. If the transactions are made in yuan, the Chinese currency will strengthen at the expense of the dollar. At the same time, Russia and India are discussing setting up alternative payment systems to deal with the banning of Russian banks from SWIFT. Other such initiatives are expected to emerge. Dependence on the dollar will become a risk, a fragility for many countries.

In this context, why not consider a return to gold, whose physical possession cannot, by definition, be questioned, and whose value is guaranteed, especially at a time when inflation is vigorously resuming? The Russian central bank halts its gold purchases to give priority to private individuals. Hold on! Will the Russians be able to use it as a transaction currency next to the ruble? We will see. Russia and China have acquired large quantities of gold in recent years, certainly with an idea in mind.



Bitcoin can also find its place, but its price remains very volatile, and its total capitalization of about $1 trillion remains limited compared to gold (ten times more). China has all but banned it (by expelling the entire mining industry where it was the world leader), while Russia has a more welcoming attitude. We must think in terms of complementarity. Governments know gold, it is part of their long memory, and bitcoin, alongside gold, can serve as a valve for the population when the national currency collapses, as is the case with the ruble at the moment. But in many countries, the greenback will no longer be the lifeline.

This seizure of dollar assets by the Russian central bank shows that fiat currencies are becoming increasingly politicized, whereas one of the basic characteristics of money should be its neutrality. This is now an illusion. War is a gas pedal of history, and money will not escape it.