A reserve currency standard is a monetary system in which a country's currency is used as a reference point for setting exchange rates and as a means of storing wealth. The currency designated as the reserve currency is widely accepted around the world and is held by central banks and other financial institutions as part of their foreign exchange reserves. In this system, the reserve currency is used for international trade and as a unit of account for pricing goods and services. The most well-known example of a reserve currency standard is the gold standard, where currencies were pegged to a specific amount of gold. Today, the US dollar is the most commonly used reserve currency in the world.
