The US supplied the Allies in WWII and got paid in gold. After the war, countries linked their currencies to the US dollar, which was linked to gold. The Gold Standard ended completely in 1971, but the US dollar’s reserve status remained. Today more than 61% of all foreign bank reserves are denominated in US dollars. Nearly 40% of the world’s debt is in US dollars. Reserve currency status has both benefits and drawbacks. The benefits are lower exchange rate risk and greater buying power, and the drawbacks are artificially low-interest rates that can spur asset bubbles. Since 1450 there have been six major world reserve currency periods. Portugal (1450–1530), Spain (1530–1640), Netherlands (1640–1720), France (1720–1815), Great Britain (1815–1920), and the United States from 1921 to today. If you notice the average currency span is 94 years. The US dollar presently has been the world’s reserve currency for roughly 99 years.

World Reserve Currencies Since 1450 – Midas Gold Group