Key Takeaways:
- Trump’s administration wants to regulate stablecoins and bring the market onshore, prioritizing USD-backed digital assets.
- David Sacks sees stablecoins as a way to strengthen the U.S. dollar’s dominance and increase demand for U.S. Treasuries.
- The White House aims to support stablecoin legislation while maintaining its stance against central bank digital currencies (CBDCs).
- Circle’s USDC is already U.S.-regulated, while Tether’s USDT dominates the global market but faces compliance concerns.
The Trump administration is moving forward with plans to regulate stablecoins and bring their market back to U.S. soil, according to David Sacks, the newly appointed “Crypto Czar.”
JUST IN: 🇺🇸 President Trump's Crypto Czar David Sacks says stablecoins have the potential to ensure the US dollar dominance internationally. pic.twitter.com/yU5BTa25k6
— Watcher.Guru (@WatcherGuru) February 4, 2025
In an interview on CNBC’s Closing Bell Over Time, Sacks confirmed that stablecoins are a top priority, alongside Bitcoin adoption and blockchain development.
“The stablecoin market has already taken off, but mostly offshore. Now, we want to bring that innovation onshore,” Sacks stated.
LIVE ON CNBC: David Sacks discusses a strategic Bitcoin reserve, a digital asset stockpile, and digital asset legislation. pic.twitter.com/dfAUUJ44DQ
— The Wolf Of All Streets (@scottmelker) February 5, 2025
Stablecoins—digital assets pegged to traditional currencies—have become a $227 billion industry, with 97% of the market comprising USD-backed stablecoins like Tether’s USDT and Circle’s USDC, according to CoinGecko data.
Stablecoins as the ‘New Digital Dollar’
Sacks believes stablecoins could play a crucial role in maintaining the U.S. dollar’s global dominance.
“Stablecoins have the potential to extend the dollar’s influence internationally and digitally,” Sacks explained.
🇺🇸 BREAKING: President Trump’s Crypto Czar, David Sacks, believes stablecoins could play a key role in maintaining the global dominance of the US dollar. pic.twitter.com/BpwSkeoViH
— Cointelegraph (@Cointelegraph) February 4, 2025
He also argued that widespread stablecoin adoption could create trillions of dollars in demand for U.S. Treasuries, helping the government manage its debt and lower long-term interest rates.
This aligns with Trump’s executive order on January 23, which emphasized promoting the U.S. dollar’s sovereignty and supporting the growth of legitimate, regulated dollar-backed stablecoins.
However, the order also made it clear that the U.S. will not pursue a central bank digital currency (CBDC)—a stark contrast to other countries, including China, which has launched its own digital yuan.
“The administration is focused on stablecoins, not government-controlled digital money,” Sacks added.
Regulation Is Coming—But USDC Already Leads the Way
While Trump’s team works on stablecoin regulations, some issuers—like Circle’s USDC—already operate under U.S. law.
- USDC is issued and regulated in the U.S., making it a compliant alternative for institutions.
- It’s the second-largest stablecoin, controlling 24% of the total market.
- USDC is legally recognized in multiple global markets, including Canada and the European Union.
Meanwhile, Tether’s USDT—the dominant stablecoin, accounting for over 60% of the market—has faced regulatory scrutiny in various regions, particularly in the EU.
🔥 JUST IN: Tether has minted 1 billion $USDT, increasing its circulating supply. pic.twitter.com/5dgv4lnopi
— Cointelegraph (@Cointelegraph) February 4, 2025
Despite this, Tether argues that its massive holdings of U.S. Treasuries actually benefit the U.S. economy.
“Tether holds more U.S. securities than Germany and more than any financial institution in the world,” Tether CEO Paolo Ardoino said in an October 2024 interview.
“We are happy to decentralize the ownership of U.S. debt, making the U.S. much more resilient.”
What’s Next?
With stablecoin regulations now a priority for the Trump administration, expect to see:
- A clearer legal framework for stablecoin issuers operating in the U.S.
- More institutions adopting stablecoins for cross-border transactions and digital payments.
- A regulatory divide between compliant stablecoins like USDC and offshore giants like USDT.
- A rejection of CBDCs as the U.S. focuses on supporting private-sector stablecoin solutions.
For now, the White House is working closely with lawmakers to finalize its approach—but one thing is clear: stablecoins are now at the center of U.S. financial policy.
