Senator Bill Hagerty (R-TN) predicts that a significant portion of the cryptocurrency sector could potentially amass substantial amounts of U.S. Treasury bonds.
In the latest chat with CNBC Television, Hagerty indicates that companies who issue stablecoins are expected to buy large quantities of U.S. Treasury bonds for their reserve funds. This is done so that the value of these digital assets stays tied to the American dollar.
Says Hagerty,
“Stablecoin issuers will be the largest holders of US Treasuries in the world.”
Hagerty proposed the Guiding and Implementing Nationwide Regulation for United States Stablecoins (GENIUS) legislation, aimed at setting up federal guidelines on how stablecoins can be utilized. This bill is now under discussion in Congress.
Asked what will back stablecoins, Hagerty says,
Instead of investing in equities, I recommend focusing on high-quality short-term assets such as short-term U.S. Treasury bonds or simply holding cash. My prediction is that a large portion of this investment will be allocated to U.S. Treasury bonds.
On Monday, Hagerty celebrated the bill moving closer to becoming law.
Tonight, the Senate advanced on the GENIUS Act, a trailblazing piece of bipartisan legislation designed to modernize America’s payment system for the 21st century. The GENIUS Act aims to establish an advanced digital payment infrastructure, capable of handling transactions at lightning-fast speeds. This move will secure the position of the US dollar as a global standard and provide enhanced protection to customers. With increased demand for U.S. Treasuries expected to surpass $1 trillion, the legislation paves the way for a flourishing digital asset sector in the United States. I’m excited about the opportunity to create history alongside my colleagues this week.
Under the proposed law, stablecoin creators would need to keep a one-to-one balance between their assets and the digital coins they issue. According to this bill, the reserves for these stablecoins can consist of U.S. dollars, deposits held as demand accounts or insured shares in a federally insured bank, or government securities such as Treasury bills, notes, or bonds.
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2025-05-21 12:45