The gold (and silver. Silver was really the more important of the two, especially after Potosi was discovered) funded the Spanish Renaissance and the Hapsburg Empire, and kickstarted the modern banking economy in Europe^A. In China, the Ming dynasty imported gargantuan quantities for use as currency, as they had very little native precious metal reserves of their own,^B in exchange for quality goods such as silk and porcelain. This went through Manila (then a Spanish colony) and often times never made it to Spain itself. As a matter of fact, very little of the pesos produced stayed in Spain; of the estimated 4 billion produced, 2.5 billion went to Europe, 850 million stayed in the Americas, and the rest went across the Pacific for silk and porcelien. 500 million then went to Asia after stopping in Spain. Much of the remaining 2 billion pesos was then spent importing various goods from the rest of Europe or buying war supplies to conquer Europe; naval stores such as wood from the Baltic, sugar from Sicily and the Ottoman Empire, and any other product that might be wanted from elsewhere was paid for with Potosi silver.  

This is an important point; the main Spanish export for the entirety of the Renaissance was pure money. Want some silk? Send a ship filled with money to China. Neighbors looking at you funny? Welp, better hire some mercenaries with that ship made of money that just arrived in harbor. The ship's late, you say? Better promise the next shipful to those nice Genoese and Dutch lenders, so that we can get that money now.  

This relentless borrowing crippled the Spanish government once the mines failed to keep up with demand, in what we might recognize today as the resource curse. Much of the specie that arrived in Spain not spent on imports went to lenders, but that portion grew ever larger as time went on, eventually culminating in a series of bankruptcies that, along with the War of Spanish Succession^C, the Anglo-Spanish War, the Seven Year's War, and the various wars of succession by Spanish colonies, crippled Spain as an empire.  

TLDR: War, imports, and debt.  

A; The price revolution is worthy of essays by itself, but the long and short of it was all that money was put into the first modern banks, especially in Genoa and the Netherlands.  

B; This same lack of local currency material lead to the invention of paper money, and shortly thereafter, hyperinflation.  

C; In a somewhat-relevant-today twist, the War of Spanish Succession was the last gasp of Catalonian independence; Catalonia went in favor of the eventual loser, the Hapsburg family, and ended up being ruled by Bourbon Spain after Barcelona fell in 1714.  

Sources  

"The Spanish Treasure Fleets", by Timothy Walton.  

"1493" by Charles C. Mann.