Trump’s BRICS Dilemma: Lula’s Clever Half-Measures and the Slow March of De-Dollarization
By Hotspotnews
In the high-stakes game of global economic power, President Donald Trump has long understood one fundamental truth: the U.S. dollar’s status as the world’s reserve currency is not just an economic advantage—it’s the bedrock of American strength. Lose that dominance, and America risks losing its ability to project power, fund its military, and maintain the living standards its citizens expect. That’s why Trump has repeatedly warned BRICS nations that any serious attempt to create an alternative currency or settlement system would be met with crushing tariffs—up to 100 percent if necessary. He called it rightly: a direct threat equivalent to “losing a major world war.”
Yet here we are in December 2025, watching a partial gold-backed BRICS settlement tool known as “The Unit” quietly launch as a blockchain-based pilot for intra-BRICS trade. Forty percent backed by physical gold, sixty percent by a basket of BRICS currencies—this is no mere academic exercise. It’s a deliberate step toward reducing reliance on the dollar for cross-border transactions, especially in commodities. And leading the charge during Brazil’s 2025 BRICS presidency is none other than leftist President Luiz Inácio Lula da Silva, a man who has openly declared that the world needs trade relations that “don’t pass through the dollar.”
Trump’s response? A series of phone calls and negotiations that resulted in partial tariff relief for Brazilian exports, lifted sanctions on a controversial Brazilian judge, and warm public statements about “productive” dialogue and potential partnerships. In exchange, Brazil’s lower house passed a bill that could dramatically reduce sentences for former President Jair Bolsonaro and others involved in the January 8 events—progress on the “lawfare” issues that originally triggered Trump’s pressure. On the surface, it looks like classic Trump deal-making: use the tariff hammer to extract concessions, then ease up selectively.
But dig deeper, and a more troubling picture emerges. Lula has proven himself a master of the half-measure. He allows just enough domestic reform to placate Washington—letting Congress take the political heat for sentence reductions—while delivering nothing close to the full amnesty or judicial overhaul that Bolsonaro’s supporters demanded. More importantly, he gives no ground on the core issue that matters most to American interests: de-dollarization. The Unit proceeds apace. BRICS continues its incremental push toward financial independence. And Brazil, America’s largest trading partner in South America, walks away with economic relief without abandoning its multilateral ambitions.
This is the Lula way: promise cooperation, deliver the minimum necessary to secure immediate benefits, and keep marching toward long-term goals that directly challenge U.S. hegemony. It’s not outright betrayal—Lula needs the American market too badly for that—but it’s certainly not the firm commitment Trump sought when he warned BRICS against any alternative to the dollar.
Conservatives should be clear-eyed about what this means. Trump’s threats slowed the most aggressive de-dollarization fantasies—no single BRICS currency is on the immediate horizon, thanks in part to his pressure and internal BRICS divisions. But incremental advances like The Unit are exactly how dollar dominance erodes: death by a thousand cuts. Each small settlement system, each bilateral trade deal in local currencies, each gold-backed pilot chips away at the dollar’s share of global transactions.
The danger is that these steps, taken individually, seem harmless. A trade settlement tool here, a blockchain experiment there—what’s the harm? But taken together, they build infrastructure for a world where the dollar is optional rather than essential. And once that infrastructure exists, switching away becomes far easier during the next crisis or sanctions episode.
Trump’s Brazil deal bought time and extracted some concessions, but it also sent a message: partial compliance can earn partial relief. That’s not necessarily wrong in tactical terms—America gains from better relations with a major hemispheric partner—but it risks encouraging the very slow-motion de-dollarization Trump vowed to stop. If every BRICS advance earns tariff relief in exchange for domestic political tweaks, the long-term strategic loss accrues to the United States.
The conservative position must remain uncompromising on this core point: any meaningful progress toward de-dollarization is unacceptable, full stop. Trump’s original instinct—threaten overwhelming economic consequences for any such move—was correct. The challenge now is ensuring that tactical deals with individual leaders like Lula don’t gradually normalize the very behavior America cannot afford to tolerate.
In the end, the dollar’s strength reflects America’s strength. Defending it requires vigilance against both dramatic challenges and subtle encroachments. The Unit may be just a pilot today, but allowing its quiet advance while celebrating minor diplomatic wins risks waking up tomorrow to find the ground has shifted beneath us. Conservatives must keep pressing the administration to remember: when it comes to the dollar’s dominance, there can be no half-measures.