Analyst: stablecoins create demand for US Treasuries and strengthen the dollar
- —Pillows: stablecoins should be backed 1:1 by cash and short-term US Treasuries
- —Growth of the stablecoin market creates mechanical demand for US Treasuries
- —US national debt has exceeded $40 trillion, China is reducing its Treasury holdings
- —Stablecoins expand the dollar in digital wallets worldwide
Why it matters: The argument links stablecoin regulation to the resilience of the US Treasury market and the dollar's position against the yuan.
Source: Blockmedia