4 weeks ago
Quick Take
Juan Leon, Senior Investment Strategist astatine Bitwise Invest, highlights the increasing power of stablecoins successful the US Treasury measure market. Currently, stablecoins clasp astir 1% of US Treasury bills, but Leon projects this could surge to 15%, perchance making them 1 of the apical 3 holders of these securities.
Leon shared a Bloomberg illustration illustrating that arsenic of June, Tether held $80.9 cardinal successful Treasury bills, surpassing Schwab’s US Treasury Money Fund astatine $70.7 cardinal and Fidelity Investments’ Money Market Treasury Only Fund astatine $79 billion.
This positions stablecoins arsenic important players successful the market, a relation traditionally dominated by the $6.19 trillion money-market communal money industry, which held astir $2.4 trillion successful authorities indebtedness by the extremity of June, according to Bloomberg. However, the Federal Reserve’s imaginable complaint cuts, perchance arsenic soon arsenic September, rise concerns astir the aboriginal attractiveness of Treasury bills.
Paolo Ardoino, Tether’s CTO, stated successful June with CryptoSlate that Tether would proceed buying US Treasuries careless of complaint cuts.
The US Treasury could look challenges successful uncovering buyers for its massive debt, particularly arsenic China continues to trim its holdings, roughly $50 billion successful the past 12 months, and Japan, the largest holder, mightiness bash the aforesaid to support its weakening currency.
Leon emphasizes the request for the US authorities to beryllium crypto-friendly, with bipartisan enactment for stablecoin regularisation successful Congress, and to travel successful Europe’s footsteps. Leon predicts that stablecoins, with a marketplace headdress presently astir $170 billion, could scope $1 trillion sooner than expected, making them ascendant players successful the Treasury market.
“At $1T, stablecoin purchases of treasury bills would dwarf the 10 largest wealth marketplace funds, and would enactment them successful the apical 3 holders ($800B+)”.
The station Stablecoins clasp astir 1% of US Treasury bills contiguous – Bitwise appeared archetypal connected CryptoSlate.
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