Stablecoins could boost US dollar and Treasury demand: BoE

Dollar stablecoins have grown to about $300 billion in circulation, prompting a Bank of England policymaker to warn that their expansion could increase demand for US Treasurys while creating new risks during periods of heavy redemptions. Summary Dollar-linked tokens account for about 98% of the global stablecoin market. USDT and USDC held nearly $150 billion in Treasury bills at the end of 2025. The two issuers bought about $33 billion in Treasury bills during the year. Large redemptions could force reserve sales and add pressure to stressed Treasury markets. Stablecoins could extend the dollar into new markets The Bank of England said in a Sep. 15 speech that stablecoins could reinforce the US dollar’s international role by making dollar-linked assets and settlement systems easier to access outside the United States. Carolyn Wilkins, an external member of the central bank’s Financial Policy Committee, told an audience at Queen’s University Belfast that dollar stablecoins already have a “considerable first-mover advantage.” About 98% of stablecoin value is denominated in dollars, according to figures cited in her speech. Stablecoins in circulation reached roughly $300 billion by mi...