While traders focus on Jerome Powell’s rate signals, stablecoins are quietly shaping Treasury liquidity, prompting debate over whether they stabilize markets or increase systemic risk.
The stablecoin market has nearly doubled to $280 billion this year, with most issuers holding short-term Treasuries as collateral. OKX Singapore CEO Gracie Lin notes this links crypto liquidity directly to Federal Reserve policy.
“Stablecoins are offering long-term price signals beyond the usual headlines,” Lin told CoinDesk. “The next step is a unified market that delivers liquidity, efficiency, and real utility for investors.”
Coinbase analysts project the market could reach $1.2 trillion by 2028, requiring $5.3 billion in weekly Treasury purchases. While inflows could modestly reduce yields, redemption surges could trigger forced selling, straining liquidity.
The debate continues: Barry Eichengreen warns of a 2008-style liquidity crunch, while former U.S. Comptroller Brian Brooks says Treasury-backed stablecoins provide safety. Coinbase models suggest they shave basis points off yields, highlighting their growing impact on global markets.
Market Snapshot
- BTC: Above $111,300, trading in a narrow range amid macro caution.
- ETH: $4,320, up 0.6%, reflecting renewed altcoin demand.
- Gold: Surpasses $3,540 an ounce, driven by Fed rate cut expectations and geopolitical uncertainty.
- Nikkei 225: Stable, supported by foreign inflows and Japan-focused capital trends.
