The development of payments infrastructure in emerging market economies – from instant payment systems in retail markets to central bank digital currencies (CBDCs) for cross-border interbank settlement – is part of a broader technological transformation. However, the intense scrutiny to which these initiatives are subjected by the United States suggests that what is at stake is not only technical supremacy, but monetary power itself. Changes in the way payments are executed imply a shift in control over the critical infrastructure through which money circulates, with consequences for the exercise of monetary sovereignty. While this was traditionally understood as the authority to issue currency, over time it was expanded to include oversight of banking systems and financial flows. However, in an increasingly digitalized world, sovereignty today depends on the mechanisms that support payments and settlements, as well as the data generated by financial transactions. This change is especially visible in emerging economies, where formal sovereignty has long coexisted with structural dependence. For years, the dollar’s dominance has been based not only on its status as a global currency, but also on a dense network of privately managed infrastructure—the Society for Worldwide Interbank and Financial Communications (SWIFT), the New York Clearinghouse Interbank Payments System (CHIPS), and the Continuous Linked Settlement System (CLS)—that determine how cross-border financial payments and settlements are carried out. Far from being mere neutral channels, these US-dominated systems integrate geopolitical power into the routine functioning of global finance, allowing interdependence instrumentalized through sanctions, exclusion and control of financial flows. Brazil’s Pix system is a clear example. Pix, an instant payments platform created and managed by the Central Bank of Brazil, has quickly become a fundamental pillar of the country’s financial architecture, surpassing payment cards in transaction volume. Pix embodies a governance model in which the state manages both payment rules and the data generated by transactions – an increasingly important source of economic and strategic power. This has clearly alarmed the United States. The Office of the United States Trade Representative (USTR) opened an investigation into Brazil and included Pix in its 2026 National Trade Estimates Report on Foreign Trade Barriers, within the broader category of “non-trade policies and practices” that could generate “economic and national security risks” to the United States. The report sees state payments infrastructure, data localization measures, and digital regulations as potential distortions of competition that harm foreign companies, particularly U.S. financial services providers. But Brazil is not an isolated case. The USTR report expresses similar concerns about efforts by India, China, Indonesia, Turkey, Vietnam, Pakistan, Algeria, Oman, Kuwait, Qatar and Thailand to develop national payment systems and strengthen regulatory control over digital and financial infrastructure, including through data localization requirements. This trend reflects a broader global shift towards a state-led approach to building financial infrastructure for the digital economy. National payment systems, including India’s Pix and UPI, should therefore be understood as part of a broader movement among emerging economies to regain control over the networks through which money and financial data circulate. This structural change becomes even more relevant at a cross-border level, as it unlocks the potential to connect national instant payment systems (such as Project Nexus, led by the Bank for International Settlements) and, more importantly, to use CBDC currencies for wholesale transactions. Projects such as mBridge – which brings together China, Hong Kong, Thailand, the United Arab Emirates and Saudi Arabia with initial support from the BIS – as well as emerging BRICS+ initiatives, illustrate how CBDCs can be used to redesign international payments infrastructure. By integrating messaging, clearing and settlement, a single state-regulated platform can reduce dependence on traditional intermediaries and enable direct settlement in local currencies. More importantly, this approach integrates public authority into the technological architecture of payments and settlements, expressed in code, protocols and governance rules. Monetary sovereignty, in this context, becomes infrastructural: it is exercised through the design and control of systems that support cross-border financial flows. For emerging economies, this represents a strategic opportunity. By reducing reliance on dollar-based infrastructure and enabling settlement in local currencies, multi-CBDC platforms and a standardized protocol linking national instant payment systems offer a path, albeit still limited, to expanding the external dimension of monetary sovereignty. Without a doubt, these advances do not predict the end of the dominance of the dollar. The structural foundations of the current US-led system, from deep and liquid domestic financial markets to strong network effects and global demand for dollar-denominated assets, are solid. The rapid expansion of dollar-backed stablecoins could even reinforce this dominance in the digital realm. But a more fragmented and contested picture is emerging. New initiatives are reconfiguring the existing system at the margins: creating alternative channels, redistributing power—albeit to a limited degree—and, above all, demonstrating that infrastructure, not currency, is the primary terrain of monetary competition. This evolution has two important implications. First, future conflicts in the international monetary system are likely to focus on rules, platforms and data governance, rather than exchange rates or reserve currencies. Second, emerging economies are no longer mere passive recipients of global financial regulations; They are becoming drivers of institutional and technological innovation. In this context, the central question is no longer who issues the money, but who designs and governs the infrastructure through which it circulates. The answer will not be determined solely by technological efficiency. It will be conditioned by legislation, institutional decisions and geopolitical strategy and will ultimately define the future distribution of monetary power. Camila Villard Duran is an associate professor of Law at the ESSCA School of Management. © Project Syndicate 1995–2026.
