Finance23 September, 20262 min read
Trump Administration Weighs Overseas Expansion Of Dollar-Backed Stablecoins With Private Joint Ventures
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US weighing joint ventures with private firms to promote overseas dollar-backed stablecoins. Aims to reinforce the dollar’s global reserve status and demand for U.S. Treasuries.
6 outlets told this the same way.
Stablecoin push abroad
The Trump administration is reportedly weighing a plan to promote dollar-backed stablecoins overseas through joint ventures with private companies, with the stated aim of reinforcing the U.S. dollar’s reserve-currency status.
Bloomberg’s reporting says the effort could involve the Treasury Department, the State Department, and the U.S. International Development Finance Corporation, and it would seek to expand international use of dollar-denominated stablecoins while potentially boosting demand for U.S. Treasurys.
The plan is framed around stablecoins as blockchain-based digital tokens pegged to the U.S. dollar, with USDT and USDC pegged 1:1 to the U.S. dollar and together accounting for almost 90% of the total stablecoin market value of $292.49 billion.
The proposal also ties stablecoin confidence to redemption, because stablecoin issuers keep backup funds to secure their value, including holding actual U.S. dollars at a 1:1 ratio and safe investments like U.S. government debt that earns interest.
The initiative is described as part of a broader push to leverage stablecoins to cement the dollar’s global dominance and increase demand for U.S. Treasury notes.
Officials link it to Treasuries
Treasury Secretary Scott Bessent has connected stablecoin regulation to reserve-currency goals, saying the GENIUS Act could strengthen the dollar’s status as the world’s reserve currency, widen access to the “dollar economy,” and increase demand for US Treasuries.
Bessent also described the GENIUS Act rules as part of an effort to “cement” the U.S. dollar’s status as the world’s reserve currency.
The reporting says the Treasury continued implementing the GENIUS Act and, on Aug. 17, issued a notice of proposed rulemaking seeking public comment on provisions covering the issuance, offering, and sale of payment stablecoins.
The plan’s logic is also tied to how stablecoin reserves are structured, because stablecoin issuers are required under the U.S. Genius Act law to hold reserves including dollars and short-term Treasuries.
The reporting further notes that stablecoin issuers have aggregate holdings approaching $200 billion and are among the top 20 holders of U.S. sovereign debt.
IMF and BIS warn of risks
The International Monetary Fund has warned that wider stablecoin adoption could accelerate capital flight, weaken domestic currencies and limit policymakers’ control over financial flows in emerging economies. The Bank for International Settlements is described as echoing that concern, warning that USD-pegged stablecoins may pose risks to emerging economies and could accelerate capital flight from these countries in times of stress. The reporting says stablecoins enable money to move over blockchains, which bypasses traditional banking channels and makes it harder for central banks and governments to monitor and influence those flows.
The sources also describe a scenario where, if dollar-backed stablecoins achieve widespread adoption in everyday transactions, domestic fiat currencies could come under intense pressure. The reporting frames the overseas initiative as potentially reinforcing dollar dominance while raising vulnerabilities for emerging economies with current-account deficits that are vulnerable to capital outflows.