Potential losers (more severe under a credible, redeemable …

Potential losers (more severe under a credible, redeemable system):
- United States (and, to a lesser degree, other core dollar issuers): Reduced “exorbitant privilege,” weaker sanctions leverage, potential decline in structural demand for Treasuries, higher funding costs, and a hit to New York/London financial intermediation rents.
- Euro area/UK financial centers: If settlement migrates to allocated gold outside the London OTC unallocated system, some margins/volumes shrink or reshape.
- Countries with low gold reserves and high external financing needs: They’d be disadvantaged in a system where trade settlement or reserve credibility leans on gold; acquiring gold crowds out other uses of scarce FX.
- Bullion banks with large unallocated liabilities/maturity mismatches: A shift toward allocated, redeemable settlement could force balance‑sheet changes and compress the carry/lease model.
- China itself (paradoxically) if backing is strict: True convertibility constrains monetary policy, creates run risk in crises, and clashes with capital controls. Loss of flexibility can be costly in downturns.