Stablecoin Regulation To Boost US Treasury Bonds To Trillions Of Dollars
Former House Speaker Paul Ryan has asserted Stablecoin regulation to significantly boost demand for US treasury bonds, potentially reaching trillions of dollars.
This move is seen as a way to monetize the US debt by systematically buying treasury bills, similar to the French ‘assignats’ of the 1790s, which led to hyperinflation.
Furthermore, the discussion also touches on the implications of stablecoins on the US dollar’s position in the global economy, the potential for a US dollar CBDC, and the role of Tether in this context.
Concerns are raised about the government’s ability to co-opt stablecoins and the scalability of other types of collateral. The debate includes perspectives on the long-term implications of stablecoins on the US economy and the global financial system.
Stablecoin Issuer Circle to Make US Legal Home Ahead of Listing
Circle Internet Financial Ltd., the issuer of the second-largest stablecoin in the crypto market, is planning to relocate its legal base from the Republic of Ireland to the United States.
This decision comes as the company aims to redomicile and has already filed the necessary paperwork. While the company has not disclosed the specific reasons for this move, it coincides with their earlier submission of plans for an initial public offering to the US securities regulator in January.
The shift to the US may subject Circle to more stringent tax regulations compared to Ireland, which is known for its relatively low corporate taxes that have attracted major companies such as Apple Inc. and Pfizer Inc.
However, recent tax reforms by the Organization for Economic Cooperation and Development impose a minimum 15% tax on the profits of larger multinational corporations, potentially impacting the advantages previously enjoyed by companies operating in Ireland.
Circle’s core business revolves around USDC, a stablecoin with a market capitalization of $33 billion. In 2022, the token’s circulation peaked at around $56 billion before experiencing a decline following banking issues in the US.
Moreover, partly due to the company holding a portion of the stablecoin’s reserves with Silicon Valley Bank, which faced challenges. However, USDC’s circulation has since rebounded from a low point of $24 billion this year, coinciding with a broader recovery in the crypto markets.
