Yellen and Bessent Highlight Stablecoins as Catalyst for Global Dollar Dominance

U.S. Treasury Secretary Janet Yellen and Deputy Secretary Scott Bessent have both recently highlighted the growing role of stablecoins in expanding the global reach of the U.S. dollar. Yellen emphasized that the implementation of the GENIUS Act—legislation passed in July—was a key step toward maintaining U.S. leadership in the digital asset space. She stated that stablecoins could significantly increase the usage of the dollar across global financial channels, potentially leading to a surge in demand for U.S. Treasury securities [1].

Bessent echoed similar sentiments, noting that stablecoins could drive the dollar’s influence by facilitating digital transactions on a global scale. He described this as a transformative development in the financial landscape, particularly as digital assets become more integrated into traditional economic systems. The Treasury’s broader strategy appears to focus on leveraging stablecoins to reinforce the dollar’s position in the global monetary order [2].

The impact of the GENIUS Act has already begun to manifest in the market. Since its enactment in mid-July, the supply of yield-bearing stablecoins has risen sharply. Ethena’s USDe and Sky’s USDS, two of the most notable stablecoins in the DeFi space, have seen substantial growth in their circulating supplies. According to DefiLlama data, USDe’s supply increased by 70% in the weeks following the law’s passage, surpassing $10 billion in total value. Meanwhile, USDS grew by 23% to nearly $4.81 billion during the same period [1].

The Treasury has also taken steps to address potential risks associated with stablecoins and other digital assets. Earlier in August, the department announced a public consultation on measures to mitigate crypto-related financial crimes and vulnerabilities. This move underscores the government’s intention to promote innovation while maintaining financial stability and regulatory integrity [2].

The growing adoption of stablecoins reflects a broader global shift toward digital currencies. By integrating these instruments into the existing financial system, the U.S. aims to strengthen the dollar’s role in international finance. However, the long-term success of this strategy will depend on the ability of regulators and market participants to navigate challenges such as privacy concerns, cross-border payment efficiency, and the risk of systemic fragmentation.

Source:

[1] U.S. Treasury Secretary: Stablecoins Will Expand the Global Channels for USD Usage, Prompting a Surge in U.S. Treasury Demand (https://www.theblockbeats.info/en/flash/307956)

[2] U.S. Treasury Seeks Public Input on Combating Crypto … (https://www.coinlive.com/en/news-flash/873734)