There are two ways to measure dollar dominance, and they tell two different stories.
By trading volume, the dollar is more dominant than it was three years ago, while by reserve share it is slowly losing ground. Both can be true at the same time, and that contradiction sits at the heart of the de-dollarization debate.
Trading Volume Says The Dollar Is Stronger
The Bank for International Settlements runs the Triennial Central Bank Survey, the most complete read on global currency flows, and the 2025 edition found the dollar on one side of about 89% of all foreign exchange transactions in April 2025.
That is up from 88.4% in 2022, with global FX trading hitting roughly $9.6 trillion per day. The dollar is in nearly nine out of every ten trades.
The euro came in second at about 29%, while the yuan rose to 8.5% - real growth, but still a fraction of the dollar's share. Because every FX trade involves two currencies, those percentages add up to 200%.
In plain English: when traders, banks, or companies move money across borders, they almost always touch the dollar at some point.
Reserves Tell A Different Story
A reserve currency is what central banks hold for emergencies like exchange rate management, import shocks, wars, and disasters.
Per the latest IMF COFER data, dollar-denominated securities make up about 57% of global foreign exchange reserves and are worth roughly $7.4 trillion. The euro is at 20%, the yen at 6%, the pound at 5%, the Canadian dollar at 3%, and the renminbi at 2%.
That share has slowly fallen from a peak of 72% in 2001, and the drop is real even though the pace is glacial.
The five largest holders of FX reserves in 2024 were China, Japan, Switzerland, India, and Russia, with China alone holding 26% of all global reserves and Japan holding 9%.
Why The Two Numbers Disagree
The dollar's role as a transactions currency and its role as a reserve currency answer two different questions.
Trading volume measures the dollar's network effect, which is built on the most liquid currency, the most liquid bonds (US Treasuries), and the deepest capital market. About $9 trillion of US Treasuries are held by foreign investors as of Q1 2025, with total US debt outstanding at roughly $28 trillion.
Reserve share measures something else, capturing what governments choose to hold as a long-term store of value. That is where the slow diversification shows up, with smaller currencies and gold picking up share while the dollar's slice gets thinner.
The dollar's share of SWIFT-settled international payments has actually risen slightly over the past five years to roughly 50% of cross-border transactions, while the dollar share of foreign currency debt issuance and international banking liabilities has stayed near 60% since 2010.
That gap is the real signal, since trading volume is hard to move while reserve composition is where central banks vote with their balance sheets.
Worth Noting
A reserve currency does not need to lose trading volume to lose its status, just the trust of the people choosing what to hold for the next 30 years.
