In addition to the US, other countries that use the US Dollar (USD) as their official currency include East Timor, Ecuador, El Salvador and Panama. Countries do not have to get permission to use another country’s currency as their own, and they might use foreign currency if its value is more stable. "Reserve currency" is a term that refers to foreign currency that is used to set domestic exchange rates or to pay off international debt. The US Dollar is the world’s most dominant reserve currency, according to 2013 estimates, and this is thought to be a reason that foreign countries adopt it instead of other currencies.
More about currency:
- Panama has only ever used the US Dollar as its official currency since the country gained independence in 1903.
- It is estimated that as much as 60% of all US Dollars circulate outside the country at any given time.
- The British pound was the most dominant reserve currency worldwide from the 18th century up until the end of World War II, in 1945, when the US Dollar replaced it.