# Special Drawing Rights in a New Decentralized Century

## TL;DR

This paper explores how Decentralized Ledger Technology (DLT) can enable the IMF to expand Special Drawing Rights into a decentralized global reserve currency, enhancing stability amid geopolitical and economic uncertainties.

## Contribution

It proposes a novel two-step approach for integrating SDRs with DLT, positioning them as a decentralized numeraire for international transactions.

## Key findings

- DLT can mitigate risks in the current IMS.
- SDRs can be expanded into decentralized currencies.
- A two-step approach facilitates SDR integration with DLT.

## Abstract

Unfulfilled expectations from macro-economic initiatives during the Great Recession and the massive shift into globalization echo today with political upheaval, anti-establishment propaganda, and looming trade/currency wars that threaten domestic and international value chains. Once stable entities like the EU now look fragile and political instability in the US presents unprecedented challenges to an International Monetary System (IMS) that predominantly relies on the USD and EUR as reserve currencies. In this environment, it is critical for an international organization mandated to ensure stability to plan and act ahead. This paper argues that Decentralized Ledger-based technology (DLT) is key for the International Monetary Fund (IMF) to mitigate some of those risks, promote stability and safeguard world prosperity. Over the last two years, DLT has made headline news globally and created a worldwide excitement not seen since the internet entered the mainstream. The rapid adoption and open-to-all philosophy of DLT has already redefined global socioeconomics, promises to shake up the world of commerce/finance and challenges the workings of central governments/regulators. This paper examines DLT core premises and proposes a two-step approach for the IMF to expand Special Drawing Rights (SDR) into that sphere so as to become the originally envisioned numeraire and reserve currency for cross-border transactions in this new decentralized century.