Bessent Says Crypto No Threat to U.S. Dollar, But a Tool for American Economic Strength?
Bessent Says Crypto No Threat to U.S. Dollar, But a Tool for American Economic Strength?
In a significant statement that could reshape the debate on digital assets and national currencies, U.S. Treasury Secretary Scott Bessent has declared that cryptocurrency does not pose a threat to the dominance of the U.S. dollar. Instead, Bessent sees stablecoins — a form of cryptocurrency designed to maintain a steady value, typically pegged 1:1 to the U.S. dollar — as a powerful new instrument to enhance the dollar’s supremacy in the digital economy.
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His comments come as Washington accelerates efforts to regulate stablecoins through the recently passed GENIUS Act, a bill that could position the United States as a global leader in the emerging digital asset economy.
Stablecoins: A Strategic Asset, Not a Threat
Stablecoins have long been a critical tool for crypto traders, offering a bridge between tokens and fiat currencies. By maintaining their value relative to the U.S. dollar, stablecoins enable quick and seamless movement of funds across digital platforms. Now, with the U.S. government’s backing, stablecoins could play a much larger role in strengthening America’s economic influence.
Speaking in a public forum and elaborating in a series of social media posts, Bessent emphasized that digital assets represent one of the most important global developments of the 21st century. “Crypto is not a threat to the dollar,” Bessent said. “It’s one of the most significant phenomena in the world right now, and it’s been ignored by national governments for far too long.”
He argued that stablecoins could become one of the largest buyers of U.S. Treasury securities, helping to sustain demand for government debt. “Imagine someone in Nigeria using a dollar-backed stablecoin to transact without ever holding a physical U.S. dollar. That is the future of dollar dominance,” Bessent added.
GENIUS Act: Bridging the Old and the New
At the heart of this new vision is the GENIUS Act — short for Guiding and Establishing National Innovation for USDC Act. Recently passed by the U.S. Senate with bipartisan support, the bill lays out a clear regulatory framework for payment stablecoins. It requires 1:1 dollar reserves, monthly audits, and removes stablecoins from direct oversight by the U.S. Securities and Exchange Commission (SEC).
President Donald Trump has called on Congress to fast-track final approval so that he can sign the bill into law. According to the White House, the act will solidify the United States' leadership in digital finance by creating a legally sound, innovation-friendly environment for stablecoin issuers.
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The GENIUS Act is seen not just as a regulatory measure but as a strategic economic tool that could link the digital dollar to America’s long-standing financial strength.
A Growing Role for Stablecoins in Global Finance
The rise of stablecoins is already transforming global finance. For the first time in history, the total supply of stablecoins has surpassed $250 billion. Market leaders like Tether and Circle account for 86% of that figure, but the ecosystem is expanding rapidly. More than 10 stablecoins now have valuations exceeding $100 million.
Bessent pointed out that stablecoins currently hold over $120 billion in U.S. Treasury securities — turning digital coins into a significant liquidity sink beyond traditional banking systems. Compared to just a few years ago, the market has evolved considerably, with stablecoins no longer seen as fringe instruments but as central players in the global monetary system.
Platforms like Ethena, a high-yield stablecoin product, have grown rapidly, reaching nearly $6 billion in assets. The diversity of issuers is broadening as well, reflecting a robust and competitive market.
Stablecoins and U.S. Currency Supremacy
Analysts suggest that stablecoins could reinforce the dollar’s position as the world’s reserve currency in several ways:
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Increased Demand for Reserve Assets: Since most stablecoins are pegged to the U.S. dollar, their widespread adoption could create new, sustained demand for dollar-denominated assets, including Treasury bonds.
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Enhanced Cross-Border Payments: Stablecoins offer a faster, cheaper alternative for international transactions. This could boost remittances and streamline global trade, further embedding the dollar in the global financial system.
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Impact on Foreign Exchange Markets: As stablecoins become more popular for everyday transactions and commerce, they could influence currency exchange rates and reshape the landscape of international finance.
Bessent noted that the Biden administration had previously sought to “make crypto extinct,” a policy he believes stifled American innovation in the sector. By contrast, the current administration sees digital assets as an opportunity to secure U.S. economic power well into the future.
The U.S. as a Digital Asset Giant
With stablecoin supply and adoption accelerating, and with supportive policies like the GENIUS Act in place, the United States is poised to become a global powerhouse in digital finance. President Trump has made clear that he sees digital assets as key to America’s future prosperity, urging lawmakers to “seize this moment of historic opportunity.”
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By embracing digital innovation while maintaining regulatory safeguards, the U.S. aims to balance consumer protection with technological leadership. As Bessent highlighted, “Stablecoins could very well be the mechanism that locks in U.S. currency supremacy for the digital age.”
Looking Ahead
As the global financial system continues to evolve, stablecoins are likely to play an increasingly pivotal role. Their ability to blend the benefits of digital technology with the stability of fiat currencies makes them uniquely positioned to support both private enterprise and public policy goals.
The GENIUS Act marks a turning point, providing the legal clarity that stablecoin issuers and investors have long sought. It also signals to the world that the United States intends to lead — not follow — in the digital currency revolution.
For now, all eyes will be on how the legislation is implemented and whether the U.S. can translate its regulatory vision into global economic influence. But one thing is clear: far from being a threat, cryptocurrency, and particularly stablecoins, could become one of the most effective tools for advancing America’s financial dominance in the 21st century.
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