Crypto was supposed to be the antidote to the U.S. dollar. Instead, one of its fastest-growing innovations is now one of the biggest buyers of U.S. government debt and regulators, bankers, and the White House are all trying to figure out what that means.
According to a report by The New York Times, stablecoins have surged from $20 billion in market value in 2020 to $300 billion today. The Federal Reserve projects they could reach $3 trillion within five years. To maintain their dollar peg, stablecoin issuers back their coins with U.S. Treasury debt, making them among the largest holders of that debt in the world. Companies like Circle and Tether now hold more Treasury bonds than major U.S. creditors including Saudi Arabia…
