The Trump Administration Has Made Stablecoins a Key Strategy to Extend the U.S. Dollar's Dominance

According to a Forbes report, the Trump Administration has made stablecoin part of its key strategy to extend U.S. dollar dominance and fund the federal government.

The Trump Administration is making stablecoin a key part of its strategy to fund the federal government and extend U.S. dollar dominance, according to a recent Forbes report. The report highlighted comments from top cabinet officials and the Federal Reserve governor.

Earlier this March at the White House crypto summit, Treasury Secretary Scott Bessent, made the following remarks:

“We’re going to put a lot of thought into the stablecoin regime. We’ll keep the U.S. dollar as the dominant reserve currency in the world through stablecoins.”

In February, Federal Reserve Governor Christopher Waller, also touched upon a similar outlook.

“The way I view it, anything that generates an increased demand for U.S. Treasury bills is a good thing.”

Stablecoin traction

According to Bessent, stablecoins were a new demand line for U.S. Treasury bills (T-bills), a point well illustrated by Tether’s USDT traction.

As disclosed by Tether CEO Paolo Ardoino, the stablecoin issuer was the seventh-largest buyer of U.S. T-bills.

Source: Tether

In 2024, the firm bought $33 billion worth of T-bills, placing it above Canada and Mexico. USDT is the world’s largest stablecoin and it is backed by U.S. T-bills, cash, and other cash equivalents.

Circle’s USDC, the second-largest stablecoin, also includes U.S. T-bills as part of its reserve to maintain a 1:1 peg to the dollar.

Overall, over 99% of the current $234 billion stablecoin market size was dollar-peg versions, which would further give the U.S. a vantage point.

Besides, it is now one of the hottest segments in crypto, attracting interest from small and large players, including governments. This week alone, Trump-linked World Liberty Financials launched its stablecoin, USD1, while Fidelity tested a similar product.

On the cross-border payments side, Paypal, Stripe, Visa, and other banks have made or are planning similar moves.

According to Ardoino, the 'stablecoin multiverse' was inevitable. To keep up with the traction and offer regulatory clarity, the U.S. Congress has introduced two stablecoin bills, the GENIUS and STABLE Acts.