Treasury Secretary Scott Bessent anticipates that stablecoins could generate $2 trillion in demand for government bonds.

The demand for government debt issued by the US Treasury may see a significant increase from the digital asset sector, potentially reaching $2 trillion in the coming years, as highlighted by Treasury Secretary Scott Bessent.

During a session with the House Financial Services Committee focused on the global financial system, Bessent underscored the rising importance of digital assets within the overall economy.

Bessent noted that the United States should play a pivotal role in establishing global standards for cryptocurrency markets, emphasizing the nation’s chance to steer innovation while reaping its benefits.

He mentioned the growing connection between stablecoins and other blockchain-based financial instruments with the US dollar and Treasury markets, illustrating how digital assets can enhance national financial interests.

### Growth of Stablecoins Boosting Treasury Interest

A significant portion of the anticipated demand is linked to stablecoins, which increasingly depend on US Treasury bills to back their reserves.

As of the end of March, Tether, the largest stablecoin provider, held approximately $120 billion in short-term Treasury bills as reserves for USDT. Similarly, Circle, which issues the USD Coin (USDC), documented T-bill holdings exceeding $22 billion as of February 2025.

As the circulation of stablecoins expands alongside global demand, the necessity for equivalent collateral in secure assets like Treasuries also rises.

The connection between digital assets and US debt markets is becoming increasingly robust, with private issuers acting as stable institutional purchasers of government securities.

This new source of demand could introduce additional stability and liquidity to Treasury markets, particularly in light of wider concerns about foreign interest in US debt.

### Legislative Initiatives Under Consideration

Draft legislation aimed at defining the role of stablecoin issuers within the Treasury system may further enhance anticipated demand.

The STABLE Act of 2025 and the GENIUS Act of 2025, both currently being debated in Congress, would mandate that issuers fully secure their tokens with high-quality liquid assets, including short-term Treasuries.

Nevertheless, there are fears that these proposals might face delays due to the partisan split between Democrats and Republicans, with nine lawmakers recently pulling their support, arguing that the bills do not include sufficient investor protections.

If enacted, these pieces of legislation could institutionalize Treasury investment requirements within the stablecoin sector, embedding digital dollars more firmly into the US financial framework.

Proponents of the bills contend that such regulations would enhance confidence in stablecoins while reinforcing the dollar’s dominance in digital markets.