- The US stablecoins market represents 96% of the global $247 billion market.
- The GENIUS Act cleared a key hurdle this week after passing a cloture vote in the US Senate.
- Bessent told senators that stablecoins represent a “new mechanism” to reinforce the US dollar’s global position.
The US stablecoin market is heading for a regulatory overhaul that could drive its market size to more than $2 trillion by 2028, according to Treasury Secretary Scott Bessent.
His comments came during a Senate hearing on Wednesday as lawmakers advanced the bipartisan GENIUS Act, aimed at introducing strict guardrails for stablecoin issuers.
Bessent stated that regulation tied to US treasuries could significantly boost global usage of dollar-backed stablecoins and maintain American monetary leadership in an increasingly decentralised financial system.
GENIUS Act gains momentum in Senate
The GENIUS Act cleared a key hurdle this week after passing a cloture vote in the US Senate, signalling broad political support for introducing federal oversight of stablecoins.
The legislation, seen as pivotal in anchoring stablecoins to the existing financial framework, mandates full backing by US dollars or similarly liquid assets.
It also imposes annual audits for issuers whose market capitalisation exceeds $50 billion.
The bill contains specific clauses to oversee the activities of foreign-issued stablecoins within the US, underscoring concerns about monetary sovereignty and potential exposure to systemic risks.
It comes at a time when the US stablecoin market, valued at approximately $247 billion, accounts for over 96% of the global total.
President Donald Trump has reportedly endorsed the bill and is pushing to have it signed into law before the summer recess.
This aligns with the administration’s broader aim to secure the dollar’s role as the dominant reserve currency, particularly in the face of rising geopolitical competition and emerging alternatives to the greenback.
Treasury predicts long-term impact on dollar usage
Bessent told senators that stablecoins represent a “new mechanism” to reinforce the US dollar’s global position, particularly in cross-border trade and decentralised finance (DeFi).
He said the $2 trillion forecast was “very reasonable”, especially if regulation drives wider institutional adoption and trust.
His remarks follow ongoing warnings from economists about challenges to the dollar’s dominance, especially from Chinese-backed central bank digital currencies (CBDCs) and other tokenised alternatives.
However, Bessent noted that historically, the dollar has retained its reserve status by adapting to new financial architectures—a trend he expects will continue through the integration of regulated stablecoins.
He emphasised that “stablecoins backed by US treasuries will serve as the next pillar of dollar strength”, calling on lawmakers to act quickly so the US can lead in shaping this emerging market.
