It’s similar to the valuation of crypto, being based on scarcity and mutual agreement, but without the risk of losing your funds from hacks or bugs, and without the benefit of online transfer. You can put it in a hole in the ground and it will be the exact same in 50 years. It’s shiny and has a history.

Nations like to use it for reserves because it’s stable, historically fit for the purpose of exchange, and well-understood. You can “count” it and use this to settle balances in a way that outsiders can’t easily interfere with.

Almost all “value” is strange and complex. Why is Francium, which is less useful than even gold, worth a theoretical $28 billion per ounce? (Not that you would find any buyers for that quantity.) Why is a Black Lotus card worth $3 million? Why is a dollar worth whatever you can buy for a dollar?

Why is a bitcoin worth anything?