stablecoin regulation impact on treasuries

Key Points:* Stablecoin legislation by mid-July under the U.S. Treasury’s directive.

• Market shift with potential demand surge for U.S. Treasuries projected.
• Stablecoins’ 1:1 backing mandate could create a multi-trillion-dollar market by 2030. U.S. Treasury Secretary Scott Bessent announced a push towards stablecoin legislation expected by mid-July, with major implications for the financial market. Stablecoins, if backed by U.S. Treasuries under the GENIUS Act, could alter demand dynamics for government securities.

The upcoming legislation is viewed as a significant shift for financial markets, especially within the cryptocurrency sector, where stablecoin issuers like Circle and Tether play a vital role. The bill’s intent to fully back stablecoins with U.S. Treasuries could reshape market structures.

Treasuries & Stablecoins: A $3.70 Trillion Market Projection

The U.S. Treasury, led by Scott Bessent, is set to finalize stablecoin legislation by mid-July. This move focuses on securing stablecoin reserves with U.S. Treasuries, aiming for reduced federal borrowing costs. Key participants include stablecoin issuers like Circle and Tether, alongside major banks eyeing potential new ventures in stablecoins.

Market forecasts predict a substantial surge in demand for U.S. Treasuries if stablecoins adhere to a 1:1 backing mandate with government-backed assets. This expected shift could result in a stablecoin market cap exceeding “3.70 trillion” by 2030 and create new U.S. Treasury demand.

Market reactions have been notable, with Adam Ackermann of Paxos highlighting large banks’ interest in stablecoin issuance. Scott Bessent underscored the potential benefits, saying, “Stablecoins could cut federal borrowing costs and slow debt growth if the GENIUS Act is passed. Reserve requirements would drive demand for U.S. Treasuries, providing structural support to government financing.”

Market Data Overview

Did you know? Stablecoin regulation could mark the largest singular regulatory impact on U.S. Treasury demand, revisiting shifts unseen since major U.S. financial reforms in past decades.

USDC’s current price is $1.00, with a market cap of “61.65 billion” and a trading volume change of 61.09% over the past day, according to CoinMarketCap. Its stability over recent months supports the potential legislative impact on market perceptions of stablecoin reserves.

USDC(USDC), daily chart, screenshot on CoinMarketCap at 14:21 UTC on June 30, 2025. Source: CoinMarketCap Insights from Coincu researchers suggest that regulatory clarity through consistent backing of stablecoins with Treasuries could foster financial stability and drive market demand. Historical trends indicate that structured regulation generally enhances market credibility and broadens participation.

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