Yes, but that's not a reserve currency, you can do settlement in any shitcoin you want. There's no guarantee you won't immediately dump it for something valuable.
Discussion
It is a failing reserve currency. I'm sure there are stages of that, some that it can recover from and some that it can't.
Is it failing? What metric do you use to evaluate that?
Is some currency replacing usd as reserves?
"Weakening" would be perhaps a more suitable word to describe it. It is for sure not a *failed* reserve currency at this point.
I don't think it is weakening in any practical sense of the word, although objectively that should be the case.
When sanctions against Russia well implemented and Russian central bank assets are frozen, it should have been a red flag for all the other central banks. Or a wakeup call.
But that's still not enough to cause a practical weakening. Most currencies are actually worse and usually much worse. One eyed is the king among the blind.
What you see is not weakening, but PR stunts. Some country takes a loan denominated in yuan, but it's for something that is delivered by Chinese companies anyway. Some deal is settled in gold. But using local currencies for trade is different than reserve status. When you look at the actual numbers of reserve composition, what is weakening is euro. Yuan will not be a reserve currency unless the Chinese gov opens the trading of capital markets, which would definitely show that emperor is naked, so they won't do it.