Yes true, there are some signs of some countries to trade in their own currencies. However, in my opinion that won't be a large scale trend.

Actually, one potential reason why China has gotten rid of some of the US debt it was holding is to prop up its own currency. I suspect the Chinese economy is not very healthy at the moment. This is actually one reason why countries hold foreign currencies as reserve. It's to stabilize their own currency when the going gets tough by selling this foreign currency reserve they have.

Part of the Chinese move could also be about as you point out, risk. In case they move in on Taiwan, they would face sanctions, and holding too much US dollars could be risky in that case. However, on the other hand, they can't reduce their US dollar holdings too much, since they would hurt themselves too.

Plus the Chinese economy is heavily dependent on exporting to the US. And what does it get back from it? US dollars. So China won't be able to cut itself off the US dollar if it wants to run a trade surplus with the US.