The Triffin paradox suggests that:

Question

Quizplus · Accepted Answer

The Triffin paradox suggests that as more and more countries hold a particular currency as a reserve currency, the issuing country must run deficits in order to supply the world with enough currency. However, running these deficits may lead to a lack of confidence in the currency, as it may be seen as unsustainable in the long run. Therefore, the paradox suggests that reserve currencies will eventually run into problems, as they must balance the demands of domestic and global economic concerns.

The Triffin Paradox Suggests That