Chinese Yuan Usage Doubles as De-Dollarization Accelerates - Here’s What It Means for Global Finance

Yuan's global surge hits unprecedented pace as dollar dominance faces structural challenge

The Shift Gains Momentum

China's currency just notched its fastest adoption rate in modern financial history. Trading volumes doubled while reserve allocations surged—central banks worldwide are quietly diversifying away from traditional dollar holdings.

Geopolitical Realignment in Action

Bilateral settlements bypass SWIFT, cutting transaction costs by half. Export-import corridors from Brazil to Saudi Arabia now default to yuan-denominated contracts. The dollar's exorbitant privilege? Looking increasingly... negotiable.

Market Mechanics Rewired

Hedging instruments multiply as liquidity deepens. Offshore clearing hubs expand operating hours to accommodate 24/7 demand. Volatility compression suggests institutional comfort with yuan exposure—no longer just a speculative play.

Meanwhile, Wall Street still charges 200bps for currency swaps that blockchain could execute at 20. Some traditions die harder than others.

De-Dollarization Reaches Peak as Usage of the Chinese Yuan Doubles

The data from World Trade Scanner shows that the usage of the Chinese yuan in trade was at 1.6% in 2022. Fast-forward to 2025, and it has now reached 3.36% in Q3 this year. That’s a jump of over 110% in just three years. The massive spike comes as China is pushing de-dollarization aggressively to promote the Chinese yuan.

However, despite the robust growth, it is much lower than the US dollar. Around 88% of all global trade is still settled in the US dollar, while the euro comes second at 30%. Even the Japanese yen commands settlements of over 15% to 17% and is five times ahead of the yuan. The Chinese yuan is only growing due to de-dollarization, and the Xi Jinping administration is making the most out of the growing discontent against the White House.

said Josh Lipsky of the Atlantic Council on de-dollarization.