TechFlow news, June 21 — According to CNBC, stablecoins could become a new tool for U.S. Treasury Secretary Bessent to help cover the country's deficit. Bessent previously praised the GENIUS Act, stating that a regulated and growing stablecoin market could create new buyers for U.S. government debt and drive private-sector demand for U.S. Treasuries. Earlier in May, Bessent told the House Financial Services Committee that there is speculation the stablecoin market could generate up to $2 trillion in demand for U.S. government securities in the coming years.
However, analysts believe the stablecoin industry is unlikely to fully resolve the U.S. government’s debt financing challenges and may introduce additional risks. The increased demand from stablecoins will take time to materialize, while the U.S. Treasury may need to issue large amounts of debt securities within a year. If problems arise that prevent the Federal Reserve from cutting interest rates, the U.S. deficit could spiral out of control.
