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Stablecoins May Help Cut U.S. Debt, Says Treasury Secretary Bessent
U.S. Treasury Secretary Scott Bessent has publicly endorsed the growing role of stablecoins in strengthening the American economy—and even helping reduce the national debt.
In a recent post on X (formerly Twitter), Bessent said that a booming stablecoin market could generate sustained demand for U.S. Treasury bonds, which in turn would lower government borrowing costs.
Stablecoin Growth Could Reach Trillions—and Bring Down Borrowing Costs
▪️ According to a new Citigroup report, the stablecoin market could expand to $3.7 trillion by 2030 in a high-growth scenario, or at minimum reach $1.6 trillion under more conservative projections.
▪️ Bessent echoed this forecast, noting that U.S.-backed stablecoins alone could exceed $2 trillion by 2028, especially if supportive legislation—like the GENIUS Act—continues to move forward.
▪️ Most major stablecoins, including Tether (USDT) and USDC, are backed by U.S. Treasury bonds, meaning issuers must purchase government debt to collateralize their tokens.
“This increased demand for Treasury securities will drive down interest rates on federal debt,” Bessent wrote, calling it a ‘win-win-win’ for the government, private issuers, and consumers.
GENIUS Act: A Legislative Boost to the Stablecoin Sector
▪️ On June 12, the U.S. Senate passed the GENIUS Act by a 68–30 vote, marking a historic step toward comprehensive stablecoin regulation.
▪️ The act is designed to create clear, secure rules for stablecoin issuance and compliance, boosting trust in the sector and enabling further growth both domestically and globally.
▪️ Bessent emphasized that this legal clarity could be the catalyst needed to make the U.S. a global hub for stablecoin development, while reinforcing the dominance of the U.S. dollar in digital finance.
Why This Matters
▪️ The U.S. national debt currently exceeds $35 trillion, and interest payments are one of the fastest-growing components of the federal budget.
▪️ If stablecoin expansion results in sustained buying of Treasury bonds, the government could see a long-term reduction in debt service costs.
▪️ This scenario would embed U.S. debt instruments more deeply into the digital asset ecosystem, further stabilizing the financial system and anchoring the U.S. dollar’s role in global markets.
Right now, the total stablecoin market stands at roughly $255 billion, but with new laws and Treasury support, it could evolve into one of the most significant financial innovations of the decade.
@ Newshounds News™
Source: Crypto Times
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U.S. Senate Passes GENIUS Act in Historic Stablecoin Milestone
In a major breakthrough for crypto regulation, the U.S. Senate passed the GENIUS Act on Tuesday, establishing the country’s first legislative framework for payment stablecoins. The bill passed with a strong bipartisan vote of 68–30, signaling growing congressional consensus on the future of digital finance.
This marks the first time comprehensive crypto legislation has cleared the Senate, and it now heads to the House for consideration.
GENIUS Act: A Defining Moment for U.S. Crypto Policy
▪️ The GENIUS Act is designed to provide clear rules for dollar-backed stablecoins, a rapidly expanding part of the crypto economy.
▪️ Senate Banking Chair Tim Scott (R-S.C.) called the legislation “a product of principled, bipartisan leadership,” adding:
“With the GENIUS Act, we’re bringing clarity to a sector that’s been clouded by uncertainty.”
▪️ Eighteen Democrats joined most Republicans to push the bill through after weeks of procedural hurdles and cross-party negotiations.
Legislative Journey Marked by Friction and Compromise
▪️ Though the bill sailed through the Senate Banking Committee this spring with bipartisan support, it stalled in early May when a group of crypto-friendly Democrats pulled support, citing a breakdown in negotiations.
▪️ Sen. Ruben Gallego (D-Ariz.), a lead Democratic negotiator, celebrated the final deal:
“This is proof of what can be achieved through honest negotiations and a willingness to work across the aisle.”
▪️ A new compromise bill emerged after two weeks of intense talks, paving the way for the landmark vote.
Industry Impact and Bipartisan Support in the House
▪️ House Financial Services Chair French Hill (R-Ark.) welcomed the Senate passage, saying:
“It brings lawmakers one step closer to creating a functional regulatory framework.”
▪️ While the House advanced its own version—the STABLE Act—in April, it has yet to come to the floor. However, Hill noted strong interest in pushing forward quickly to align with Senate progress.
Criticism and Political Tensions Around Trump Ties
▪️ Some Democrats expressed concern about conflicts of interest involving former President Donald Trump, noting the absence of provisions to prevent him from profiting off stablecoin regulations.
▪️ Sen. Jeff Merkley (D-Ore.) criticized the final bill:
“Passing the GENIUS Act without strong anti-corruption measures stamps a Congressional seal of approval on President Trump selling access to the government for personal profit.”
▪️ The initial plan to allow floor amendments was scrapped by Senate Majority Leader John Thune (R-S.D.) to avoid last-minute complications, including controversial proposals like the Credit Card Competition Act.
What’s Next: Market Structure Legislation Still Pending
▪️ The stablecoin bill is part of a larger Republican and Trump administration effort to establish clear crypto rules before August.
▪️ The broader Digital Asset Market Clarity Act, which would determine how regulatory power is split between the SEC and CFTC, has made slower progress but cleared two key House committees last week.
Conclusion:
The Senate’s passage of the GENIUS Act represents a historic win for the crypto industry, marking a shift from regulatory ambiguity to legislative clarity. With the House now expected to take up the measure, stablecoin oversight could soon become the first officially codified area of U.S. crypto law.
@ Newshounds News™
Source: The Hill
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BRICS Bank to Disburse Loans in National Currencies, Reducing U.S. Dollar Dependence
The New Development Bank (NDB), also known as the BRICS Bank, is moving forward with plans to issue loans in national currencies, a major step toward reducing reliance on the U.S. dollar and strengthening local financial sovereignty among member nations.
The initiative aims to center regional currencies in cross-border financing and make the bank more resilient against external financial pressures.
A Strategic Response to Western Sanctions
▪️ The shift was confirmed by Russian Deputy Foreign Minister Sergey Ryabkov, who attributed the move to sanctions imposed by the White House on several developing countries.
▪️ Ryabkov stated that Russia is working closely with NDB to promote lending and repayment in national currencies, positioning the bank as a more attractive and autonomous lender for emerging economies.
“Sanctions pressure from Western countries still impedes the normal functioning of the bank on the territory of the Russian Federation,” Ryabkov noted.
Dilma Rousseff’s Role in Overhauling BRICS Lending Framework
▪️ The bank’s president, Dilma Rousseff, has been tasked with leading the transition. According to Ryabkov, she is actively implementing measures to expand financing in national currencies and develop new investment tools.
▪️ He emphasized that these steps are aimed at aligning the NDB’s operations with BRICS’ larger vision of a fair, non-discriminatory global financial system.
“The management of NDB… takes necessary steps for BRICS Bank to meet its goals on a fair and non-discriminatory basis,” Ryabkov said.
Trade Wars and Tariffs Fuel the Push for Independence
▪️ Ryabkov also criticized ongoing tariffs and trade wars, stating that these measures have disrupted the flow of global trade and undermined multilateral cooperation.
▪️ He said BRICS nations are united in their view that Western-imposed economic barriers hinder progress toward sustainable development goals.
“Such measures undermine the multilateral trade system,” Ryabkov warned, reiterating BRICS’ call for more inclusive and balanced global finance.
What This Means for Emerging Economies
▪️ By enabling billions in loans to be disbursed and repaid in national tenders, the BRICS Bank is not only insulating member economies from geopolitical pressure—but also increasing the strength and utility of local currencies.
▪️ The move may encourage greater adoption of national currencies in regional trade and investment, positioning BRICS as a serious counterbalance to the dollar-dominated financial order.
▪️ Although no timeline has been announced, the shift signals a deeper financial realignment as the BRICS alliance continues its push for monetary multipolarity.
@ Newshounds News™
Source: Watcher.Guru
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