SDR is the abbreviation of Special Drawing Rights, which translates to Special Drawing Rights, also known as paper gold. It is an international reserve asset created by IMF in 1969, which is mainly used to make up for the shortage of official reserves of member countries. Its value is currently determined by a basket of reserve currencies consisting of US dollar, Euro, Japanese yen and British pound.

The original intention of SDR is to support the Bretton Woods system with fixed exchange rate. Governments or central banks participating in this system need to hold gold and widely accepted foreign currencies and buy their own currencies in the foreign exchange market to maintain the exchange rate of their own currencies. However, the international supply of gold and US dollar, two major reserve assets, was insufficient to support the expansion of world trade and financial development at that time. Therefore, the international community decided to create a new international reserve asset with the support of IMF.

The holders of SDR can convert SDR into currencies freely used by IMF members in two ways: first, through voluntary exchange arrangements among member countries; Second, the IMF designated member countries with abundant external positions to purchase SDR from member countries with insufficient external positions in freely usable currencies. In addition to being a supplementary reserve asset, SDR is also an accounting unit of international organizations such as IMF.