Could a monetary reset be on the horizon amid the backdrop of Russia’s invasion of the Ukraine? Recent comments made by Federal Reserve Chairman Jerome Powell, combined with Western threats against Russia’s gold reserves, are bringing this possibility into the spotlight.

When Powell stated that “It’s possible to have more than one reserve currency,” it raised more than a few eyebrows. As the individual with the greatest level of control over the current world reserve currency, the U.S. dollar, his comments cast doubts on the American currency’s supremacy.

It comes as the U.S. wages an economic war against Russia in the wake of Vladimir Putin’s invasion of Ukraine. An aggressive campaign of sanctions has put Russia in the position of being the most sanctioned country in the world.

One former Treasury Department official, Peter Piatetsky, said: “This is financial nuclear war and the largest sanctions event in history.” He pointed out that the country went from being a part of the global economy to a financial pariah in just a few weeks’ time.

After the U.S. and European governments froze Russia’s U.S. dollar and euro reserves, which were worth roughly $300 billion, the country’s banks were then kicked out of a major system used to send international wire transfers, SWIFT. Now, Western companies are fleeing Russia and banning its citizens from using their platforms, with cryptocurrency exchange Coinbase blocking thousands of accounts linked to Russia and major credit cards like MasterCard and Visa cutting Russia off from their networks.

Russia has been planning these attacks for some time, and they do have alternatives to SWIFT that will allow them to continue to participate in international financial transactions. Many Russian banks are now turning to China UnionPay, another global payment processing network.

At the same time, many countries, such as China, India, Turkey and Iran, are now doing business with Russia using their local currencies rather than the U.S. dollar, and this is significant because they represent a market made up of more than 3 billion people who no longer depend on American dollars for trading.

Therefore, this is a major threat to the power America yields as the home of the world’s premier reserve currency. By isolating Russia as well as its trading partners, the government is essentially pushing other countries to find alternatives to the dollar.

Could gold replace the U.S. dollar?

Another alarming development, according to international investor Nick Giambruno, is the current status of the gold market. Russia has accumulated more than 74 million troy ounces of gold, which means it owns one of the world’s biggest stashes, worth roughly $140 billion. Russia’s gold is reportedly stored in vaults within the Russian Federation’s territory.

Their gold mining industry makes up around a tenth of global output, or $20 billion a year.

Giambruno explained: “Russia’s gold is a big deal because it gives them access to an apolitical neutral form of money with no counterparty risk. Remember, gold has been mankind’s most enduring form of money for over 2,500 years because of unique characteristics that make it suitable to store and exchaconge value. Gold is durable, divisible, consistent, convenient, scarce, and most important, it’s the ‘hardest’ of all commodities.”

Therefore, Russia’s gold could be an attractive alternative to the American dollar. They have a lot of it, and if they join forces with China, their gold could form the basis of a new monetary system over which the U.S. would have little control.

Giambruno suspects that the U.S. and its allies are well aware of this, particularly considering how they’ve been recently targeting Russia’s gold reserves. From introducing a Senate bill that would sanction anyone who buys or sells Russian gold to kicking the country out of the London Bullion Market Association, it appears that fears are growing that a huge monetary reset may be about to take place.

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