Trump administration weighs a global stablecoin plan to cement dollar's dominance
The Trump administration is exploring a plan to promote the global use of U.S. dollar-backed stablecoins to reinforce the dollar's dominance. By partnering with private firms, the government aims to increase demand for U.S. Treasury notes.
Why it matters
This strategy represents a significant shift in how the U.S. might leverage blockchain technology to maintain its geopolitical and economic influence.
According to Bloomberg , the Trump administration is considering a plan involving joint ventures with private players to promote the use of dollar-backed stablecoins overseas. The aim is to boost the dollar’s dominance and source demand for U.S. Treasury notes.
Treasury and State Departments could play key roles in promoting U.S. dollar stablecoins globally, alongside the U.S. International Development Finance Corporation.
Stablecoins are blockchain-based digital tokens whose values are pegged to an external reference, such as the U.S. dollar. These tokens, therefore, are widely seen as the tokenize versions of the fiat currencies and are widely used to fund crypto trading and cross-border payments.
USDT and USDC, the world’s top two stablecoins, are pegged 1:1 to the U.S. dollar. Together, they account for almost 90% of the total stablecoin market value of $292.49 billion.
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