Crypto Czar: Stablecoins Are Fueling US Dollar Demand Like Never Before

Stablecoins aren't just propping up crypto—they're becoming the dollar's unlikely hype squad.

The digital dollar's secret weapon

Tether, USDC, and their algorithmic cousins now move more value than some national payment systems. Every minted stablecoin means fresh demand for US Treasury holdings—Wall Street's favorite collateral with a side of geopolitical clout.

Who needs currency wars when you've got blockchain?

Of course, the Fed probably didn't envision its monetary policy being turbocharged by crypto degens and offshore exchanges. But here we are—another case of decentralized finance 'disrupting' things by enthusiastically reinventing banking, just with more memes.

Stablecoin Cryptocurrencies Set To Dominate?

Stablecoins have become an integral part of the crypto industry. The GENIUS Act reached a milestone approval in the US Senate on Thursday. The Act cleared the Senate floor with a 68-30 vote. The Act will now move to the House for the next step. President Trump said he wants to approve the legislation before Congress’s August recess. The legislation demands a $1 reserve for every $1 of coins. Issuers will also need to comply with anti-money-laundering rules.

According to Delphi Digital, Stablecoin supply has passed the $250 billion mark for the first time in its history. The report highlights that yield-bearing stablecoins are growing at a rapid rate. Tether and Circle continue to dominate the market. Both issuers account for nearly 86% of the market.

Stablecoin supply has passed $250 billion for the first time.

• Yield-bearing stablecoins are growing fast. Ethena has grown to nearly $6 billion since launch.
• Tether and Circle still dominate, holding a combined 86% of outstanding supply.
• Issuer diversity is increasing.… pic.twitter.com/mrokz8u4OL

The advent of dollar-pegged cryptocurrencies could bring new hope for the fading love of the US dollar. According to Bank of America (BoA) strategist Ralph Axel, stablecoins could further propel the US dollar’s position in global finances. Axel stated, ““

The US dollar has seen a decline over the last decade. Many nations are moving to local currencies for mutual trade. The coming of stablecoins could change this narrative. We could see nations pivot to stablecoins for trade and to keep foreign reserves. With a global MOVE towards Web3, a shift to dollar-pegged cryptocurrencies may not be such an outlandish idea.