How To Buy USD With Your Local Currency

The U.S. dollar (USD) is the world’s benchmark fiat currency. It’s also the most liquid of all fiat currencies. (Fiat currency is money that has no intrinsic value and is declared legal tender by a government. The Japanese yen and Australian dollar are other examples of fiat currency.)

When an economic crisis hits, demand for USD usually jumps. This is why the U.S. dollar is widely described as a store of value or a safe haven. (This means that USD is considered a currency that you can relatively confidently store your wealth in.)

In extreme economic and financial meltdowns, demand for USD can actually outpace traditional store-of-value assets like gold and bonds. This was particularly true during the 2020 coronavirus pandemic, for example.

READ: What is Economics?

There are many ways to convert your local currency into U.S. dollars. (Or, if not into the U.S. dollar itself, then at least into a financial instrument that can track its performance.) This conversion is called foreign exchange—or forex for short.

Buy USD-Backed Stablecoin Cryptocurrencies

Want a simple way to gain exposure to the value of the U.S. dollar? Buy a type of stablecoin known as a fiat-collateralised stablecoin. (For those unaware, stablecoins are cryptocurrencies that are designed to maintain a stable value.)

USD-backed stablecoins are very popular in the crypto space. For this reason, you can buy them from basically all crypto exchanges as well as cryptocurrency brokers.

The most common USD-backed stablecoins are tether (USD₮), TrueUSD (TUSD), USD Coin (USDC), Paxos Standard (PAX), Binance USD (BUSD), and Gemini Dollar (GUSD).

READ: What are Stablecoins?

On crypto exchange FTX, you can convert other fiat currencies like AUD to USD. When on your FTX wallet, hit the ‘CONVERT’ button next to the currencies. Your local currency will be converted into USD-backed stablecoins using FTX’s live exchange rate.

To get AUD onto FTX, you have to make an international money transfer through the SWIFT international payment network. At the time of writing, FTX plans to soon enable domestic money transfers for Australians.