But what if most of the world currencies have the same issue? Will this de facto partial default as bad then?

Then you see the collapse of the global economic system as credit crashes and nobody can effectively transact business.

If you cant trust a currency, you have to revert to much more cumbersome and limiting contracts. e.g. loaning cash today to be repaid in gold tomorrow.

Furthermore, the undesirability of a currency severely limits the ability of governments to maintain economic stability.

What if? Sure, but there is little reason to expect that to happen.