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BlackRock Report Highlights De-Dollarization and New Reserve Strategies
In a landmark shift for global finance, BlackRock—the world’s largest asset manager with nearly $12.5 trillion under management—has spotlighted the accelerating move away from the US dollar in its July 2025 report. The phenomenon, commonly referred to as "de-dollarization," is now taking center stage as central banks diversify their reserves amid economic and geopolitical challenges. While gold maintains its dominance as the primary alternative asset, Bitcoin is starting to feature in high-level reserve discussions.
De-Dollarization Moves From Theory to Practice
According to BlackRock, major central banks are increasingly reconsidering their reliance on the US dollar. This strategic shift is fueled by rising global tensions, stubborn inflation, and renewed doubts about US fiscal stability.
The weakening of the dollar has been particularly profound, with a decline of over 10% in just six months—an occurrence not seen since the early 1970s when the world moved off the gold standard. Such a rapid drop in the dollar’s value has significant implications for both traditional and digital assets, triggering heightened demand for alternatives like gold and cryptocurrencies, notably Bitcoin.
Former President Donald Trump acknowledged this trend, stating that while he favors a strong dollar, a weaker greenback can generate significant economic advantages. As the dollar falls, crypto assets priced in USD become more attractive and affordable to international investors, potentially undermining faith in fiat currencies and fostering interest in decentralized alternatives.
Central Banks Bolster Gold Holdings Amid Shifting Reserve Landscape
The impact of de-dollarization is reflected in central bank activity. In 2024 alone, central banks collectively acquired over 1,000 metric tons of gold—more than double the average annual intake over the past decade. As a result, official gold reserves globally have neared 36,000 metric tons, a threshold not approached in over half a century.
Today, gold constitutes around 20% of total global reserve assets. Meanwhile, the US dollar’s share has slipped to about 46%. Euro reserves account for 16%, while other currencies make up 18%, based on data provided to Business Insider.
Gold remains the central building block for reserve portfolios, acting as a hedge against both inflation and geopolitical uncertainty. But notably, BlackRock reports an increasing frequency of references to Bitcoin (BTC) in official discussions regarding the future of sovereign reserves.
Bitcoin’s decentralized nature, supply cap, and independence from government control are qualities seen as potentially strategic. While central banks have yet to officially acquire Bitcoin in significant amounts, its emergence in policy analysis signals the dawn of a new era in reserve management.
Gold and Crypto Reserves: Trends, Buyers, and Market Dynamics
Central Bank Gold Buying Surges to Historic Highs
The gold-buying spree by central banks continued into early 2025, with first-quarter acquisitions surpassing 244 metric tons. Gold-backed exchange-traded funds (ETFs) also benefited, attracting nearly $30 billion in fresh capital—the highest inflow recorded since 2020.
According to the World Gold Council’s May 2025 update, central banks made net purchases of 20 metric tons that month. Kazakhstan led with 7 tons, while Turkey and Poland each added 6 tons. Importantly, a recent survey found that 95% of reserve managers expect global gold holdings to climb even higher over the next year.
Nearly half of surveyed managers plan to boost their own gold reserves, and over 70% foresee reducing their dollar exposure within five years—transitioning instead to gold, the euro, or China’s renminbi.
Emerging markets such as Azerbaijan, China, and Iran have consistently been among the most active gold buyers, often motivated by the drive to shield their national wealth from sanctions or exchange rate volatility. In April 2025, gold prices reached a record $3,500 per troy ounce. According to research firm Metals Focus, the value of official gold purchases this year stands at roughly $80 billion, with further growth likely as geopolitical and financial uncertainties persist.
China’s central bank, in particular, has been a major force, raising its reported gold reserves from about 2,000 metric tons in late 2022 to 2,299 metric tons by mid-2025. Some analysts suspect that China’s true holdings may be higher, factoring in additional imports and possible off-balance-sheet storage mechanisms.
The current wave of gold accumulation starkly contrasts with the net selling trend observed in the late 1990s. Since 2023, central bankers have accounted for nearly a quarter of global gold demand—purchasing at rates far outstripping those of ETF investors. In the past five years, central banks have absorbed roughly one in every eight newly mined gold ounces, reflecting a determined effort to strengthen national reserves.
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Bitcoin Enters the Reserve Asset Conversation
While gold’s status is clear, Bitcoin is increasingly viewed as a potential complement in the evolving reserve asset mix. The cryptocurrency’s rise as a digital store of value—capped in supply and immune to political interference—has caught the attention of policymakers worldwide.
In January 2025, the Czech National Bank broke new ground by launching an official internal study into Bitcoin’s role within reserve portfolios, suggesting a possible allocation of up to 5% of its €140 billion in assets. Switzerland has seen grassroots campaigns urging the Swiss National Bank to dedicate 1-2% of reserves to Bitcoin.
Despite such initiatives, central bank adoption of Bitcoin is still in its infancy. A 2025 survey by Central Banking Publications, covering more than 91 central banks and $7 trillion in reserve assets, found that none currently hold Bitcoin. Only 2% expressed any willingness to invest in cryptocurrencies over the next five to ten years—a dramatic drop from 16% just a year earlier.
A related assessment by OMFIF’s Global Public Investor 2025 report echoed these findings, with 93% of central bankers reporting no plans to add digital assets to their portfolios.
The hesitance is driven by concerns over Bitcoin’s high volatility, uncertainties around liquidity during market stress, and unresolved issues regarding safe custody and cybersecurity. Additionally, many central banks are legally constrained or operate under conservative investment mandates that favor time-tested, well-regulated assets.
Nonetheless, Bitcoin’s inclusion—even at a discussion stage—marks a shift in institutional awareness and possibly, in the long term, adoption.
Governments Begin Formal Steps Toward Bitcoin Reserves
While widespread central bank adoption remains unlikely in the near future, some governments and local authorities are exploring official Bitcoin reserves. In March 2025, the US government established a Strategic Bitcoin Reserve, housing roughly 200,000 seized Bitcoins in a Treasury-managed account. Texas soon followed, allocating $10 million to a state-level Bitcoin reserve as a long-term hedge. Pakistan’s finance ministry also announced plans to begin building a sovereign Bitcoin portfolio.
A prominent example is El Salvador, which now holds over 6,000 BTC—though its advocacy has been tempered by ongoing negotiations with the IMF. In Bhutan, Bitcoin comprises close to 28% of GDP, exemplifying how resource-rich and energy-advantaged nations may leverage digital assets for strategic gain.
Bitcoin’s Rising Value and Institutional Legitimacy
Bitcoin’s dramatic ascent in 2025 has propelled it further into mainstream financial dialogues. On July 14, the cryptocurrency broke past $123,000, representing a 75% surge since late 2024. Institutional capital inflows—over $50 billion led by BlackRock’s iShares Bitcoin Trust, now surpassing $80 billion in assets—have been a decisive catalyst.
Remarkably, the performance of Bitcoin ETFs has already outpaced the early success of leading gold ETFs, illustrating the rapid pace at which digital assets are being integrated into institutional strategies. As of July 26, Bitcoin settled near $118,000, up approximately 10% from a month earlier.
In tandem with this rally, regulatory developments have provided greater certainty for participants in the digital asset space. The US has introduced key legislative measures, including the CLARITY Act and the GENIUS Act, defining digital asset categories under federal law and outlining clearer market guidelines. At the same time, resistance to launching a US central bank digital currency further cements Bitcoin’s unique status as a decentralized, non-sovereign asset.
According to VanEck, Bitcoin’s volatility—traditionally a major obstacle—has moderated significantly compared to equities, strengthening its candidacy as a reliable store of value. With central banks and institutional investors alike revisiting their reserve frameworks, the maturation and regulatory clarification of digital assets is a trend that will shape the future reserve landscape.
The Future of Bitcoin and Gold in Central Bank Reserves
Despite its limited use by central banks today, Bitcoin’s expanding role in institutional and governmental strategies signals the start of a long-term evolution. While gold remains the gold standard for reserves, digital assets, led by Bitcoin, are positioning themselves as formidable contenders—especially as global economic and monetary uncertainties escalate.
For the crypto community and market observers alike, these developments reflect both new opportunities and emerging complexities. As both Bitcoin and gold continue to see increased demand from sovereign and institutional investors, the global reserve system looks set for a transformative shift—one driven by diversification, digitalization, and a search for resilience amid a changing economic order.
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